Renewable energy tax credits that are credited with encouraging much of the wind turbine growth in Texas are being debated again by federal legislatures. In a flip-flop of federal tax law, the credits have long been a stop-and-go policy, which one politician says is bad for business.
At a time when the nation needs long-term energy plans, says the politician, changing tax laws on a regular basis discourages some future-centric outlooks. The senator, Ron Wyden, said the inconsistent nature of the tax credits damages the growth of wind energy.
The Senate is currently debating a measure that would extend the chance for businesses to receive a 10-year tax credit for renewable energy projects. The tax credit offers a reduction of tax liability at a rate of 2.3 cents per kilowatt-hour produced. The law was previously leveraged by a number of businesses, though it didn’t always exist and was renewed eight different times.
The Senate’s measure extends the ability to develop projects that are available for the tax credit. According to reports, the measure would let companies claim the tax credits on any project that began construction before the end of 2015. Estimates are that the measure would result in $13 billion in tax credits over a decade.
As lawmakers continue the debate, businesses in Texas and across the country watch and wait for a green light on sustainable energy projects, many of which require the tax credits for profitability. No matter what industry you are in, it’s important to keep up with tax law changes at all levels. Filing returns based on expired credits puts you at risk for an audit but not claiming credits means your business loses out on refunds.
Source: Houston Chronicle, “Tax credit for renewable energy confronts congressional headwinds” Jennifer A. Dlouhy, May. 14, 2014