In the past, if a diesel generator is purchased to run a well pump at a vineyard, it receives a tax exemption from state taxes, but a solar system used to off-set an electrical pump did not. Why? The thought was that since the diesel generator was directly tied to the pump, it qualified. Since the solar system was tied to the utility grid, not directly to the pump, it did not.
In these past few weeks, the California State Board of Equalization has rectified this situation. The Board of Equalization staff has released an opinion clarifying that the tax exemption can be applied to solar equipment if the taxpayer can “demonstrate that the solar facility is specifically designed to provide power to qualifying machinery.” Farmers who made this purchase in the past 3 years, may qualify for a refund. For more information visit https://www.synsolar.com/pdf/Farm_Solar_Power-taxes.pdf.