Personal Property Tax Exemption for Solar Panels

Michigan property owners with solar panels are likely eligible for 100 percent tax exemption

Current tax rules likely exempt most small-scale systems

LANSING, Mich. – The Michigan Agency for Energy (MAE) and Michigan Public Service Commission today announced the release of their newest consumer tip, Personal Property Tax Exemption for Solar Panels. The new consumer tip explains an existing tax exemption that can be utilized by property owners to exempt small-scale solar projects, including many systems used by homeowners.

“Staff at the Michigan Agency for Energy have heard concerns from numerous customers about the difficulties they face in determining whether their solar installation is subject to taxation,” said Valerie Brader, MAE executive director. “Our new consumer tip will help to inform customers of an important, existing tax exemption they can use to help make solar more affordable.”

The existing tax exemption applies where the total value of the solar unit (which is classified as industrial personal property) owned by a property owner and located in a single taxing unit does not exceed $80,000. Given that most residential solar installations cost less than $80,000, many homeowners with solar systems likely qualify for the exemption.Property owners wishing to claim the exemption must do so by February 20.

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