Solar Pole Mounts

Solar Pole Mounts

November 20, 2014 | By Keith Martin in Washington, DC

Solar pole mounts qualify for tax credits as part of a solar system, the IRS said.

The IRS made the statement in a private letter ruling that it made public in late October. The ruling is Private Letter Ruling 201444025.

The ruling was issued to a company that designs and sells solar panels that are mounted on poles, but it retains some to own and operate itself. The poles are of varying heights. The electricity produced powers equipment like lights and speed cameras. There is a base that holds the pole firmly in place. There may also be special doors at the base that lock for security reasons. The poles are sized for the solar panels, and are not suitable for use other than supporting the panels.

A 30% investment tax credit can be claimed on “equipment which uses solar energy to generate electricity.” The IRS said the panels, battery, control equipment, conversion equipment and wiring all qualify and the pole does as well because it is “essential to the functioning of this equipment.”

However, the IRS said, the company must allocate part of the cost to any lights, surveillance equipment, motion detectors, two-way transmission systems and other attachments that protect such equipment from foul weather. These items are not used to generate electricity and do not qualify for a tax credit.

Separately, IRS officials in Washington are concerned that some taxpayers installing solar systems are replacing the roof at the same time and may be improperly claiming a federal tax credit on the cost of the roof replacement. This is of particular concern where the solar panels or tiles double as the roof. The IRS says the taxpayer must back out of tax basis for the credit what it would cost solely to replace the roof without also installing solar panels.

contributed by Keith Martin in Washington