H.F. 2395 Section 1. Section 422.11L, subsection 3, paragraph d, Code 1 2022, is amended to read as follows: 2 d. (1) (a) A taxpayer must submit an application to the 3 department for each separate and distinct solar installation. 4 The application must be approved by the department in order to 5 claim the tax credit. The application must be filed by May 6 1 following the year of the installation of the solar energy 7 system. 8 (b) Notwithstanding the May 1 application deadline in 9 subparagraph division (a), a taxpayer submitting an application 10 for an installation described in subsection 1, paragraph “a” , 11 that was completed during the 2021 calendar year, has until 12 June 30, 2022, to submit an application for review pursuant to 13 subsection 7. 14 (2) The department shall accept and approve applications 15 on a first-come, first-served basis until the maximum amount 16 of tax credits that may be claimed pursuant to subsection 4 17 is reached. If for a tax year the aggregate amount of tax 18 credits applied for exceeds the amount specified in subsection 19 4 , the department shall establish a wait list for tax credits. 20 Valid Except as provided in subparagraph (1), subparagraph 21 division (b), valid applications filed by the taxpayer by May 22 1 following the year of the installation but not approved by 23 the department shall be placed on a wait list in the order 24 the applications were received and those applicants shall 25 be given priority for having their applications approved 26 in succeeding years. Placement on a wait list pursuant to 27 this subparagraph shall not constitute a promise binding the 28 state. The availability of a tax credit and approval of a tax 29 credit application pursuant to this section in a future year 30 is contingent upon the availability of tax credits in that 31 particular year. 32 Sec. 2. Section 422.11L, subsection 4, paragraph a, Code 33 2022, is amended to read as follows: 34 a. The Except as provided in subsection 7, the cumulative 35 -1- LSB 5571YH (8) 89 jm/jh 1/ 4

H.F. 2395 value of tax credits claimed annually by applicants pursuant 1 to this section shall not exceed five million dollars. Of 2 this amount, at least one million dollars shall be reserved 3 for claims associated with or resulting from residential solar 4 energy system installations. In the event that the total 5 amount of claims submitted for residential solar energy system 6 installations in a tax year is an amount less than one million 7 dollars, the remaining unclaimed reserved amount shall be 8 made available for claims associated with or resulting from 9 nonresidential solar energy system installations received for 10 the tax year. 11 Sec. 3. Section 422.11L, Code 2022, is amended by adding the 12 following new subsection: 13 NEW SUBSECTION . 7. a. Notwithstanding any other law to the 14 contrary, the following applicants shall be eligible to claim 15 the credit for the tax year beginning on or after January 1, 16 2022, but before January 1, 2023, for the credit described in 17 subsection 1, paragraph “a” , as if the credit did not expire: 18 (1) An applicant with a valid application who was on the 19 wait list pursuant to subsection 3, paragraph “d” , subparagraph 20 (2), as of December 31, 2021, and who did not receive the 21 credit. 22 (2) An applicant whose application went through the review 23 process of the department and who otherwise had a valid 24 application but was nevertheless sent a denial letter by the 25 department for the 2021 award year regardless of whether or not 26 the applicant appealed the denial letter. 27 (3) An applicant with a valid application whose application 28 was in the review process of the department but whose 29 application expired due to the expiration of the credit 30 described in subsection 1, paragraph “a” . The department 31 shall reinstate and review such an expired application. 32 The department shall use the original submission date of 33 reinstated applications to determine the order of reviewing 34 such applications. 35 -2- LSB 5571YH (8) 89 jm/jh 2/ 4

H.F. 2395 (4) An applicant who has not submitted an application for an 1 installation that was completed during the 2021 calendar year 2 but who submits a valid application on or before June 30, 2022. 3 b. The cumulative value of tax credits in subsection 3, 4 paragraph “d” , subparagraph (2), shall not limit the amount of 5 annual tax credits that may be awarded for valid applications 6 that qualify pursuant to this subsection. 7 Sec. 4. EFFECTIVE DATE. This Act, being deemed of immediate 8 importance, takes effect upon enactment. 9 Sec. 5. APPLICABILITY. A tax credit award issued pursuant 10 to this Act applies to tax years beginning on or after January 11 1, 2022, but before January 1, 2023. 12 EXPLANATION 13 The inclusion of this explanation does not constitute agreement with 14 the explanation’s substance by the members of the general assembly. 15 This bill relates to the solar energy system tax credit 16 available against the individual and corporate income tax, the 17 franchise tax, and the moneys and credits tax. 18 BACKGROUND. Currently, the solar energy system tax credit 19 expired for residential installations completed after December 20 31, 2021, due to conforming with a version of federal law that 21 no longer applies. Additionally, a maximum of $5 million of 22 both residential and commercial solar energy system credits may 23 be annually claimed in the aggregate, and a wait list exists 24 for installations completed on or prior to December 31, 2021. 25 CHANGES IN THE BILL. The bill changes the solar energy 26 system tax credit application due date for residential 27 installations that were completed during the 2021 calendar year 28 from May 1, 2022, to June 30, 2022. The bill also removes the 29 annual maximum $5 million limit placed on residential solar 30 energy system tax credit claims for certain applicants. The 31 bill does not extend the residential solar energy system tax 32 credit for installations that are completed after December 31, 33 2021. 34 The following residential solar energy system tax credit 35 -3- LSB 5571YH (8) 89 jm/jh 3/ 4

H.F. 2395 applicants are eligible to claim the solar energy system tax 1 credit for the 2022 tax year as if the residential solar 2 energy system tax credit did not expire: an applicant with a 3 valid application who was on the wait list as of December 31, 4 2021, and who did not receive the credit; an applicant whose 5 application went through the review process of the department 6 of revenue and who otherwise had a valid application but 7 was nevertheless sent a denial letter by the department of 8 revenue for the 2021 award year regardless of whether or not 9 the applicant appealed the denial letter; an applicant whose 10 application was in the review process of the department of 11 revenue but whose application expired due to the expiration 12 of the credit; and an applicant who has not submitted an 13 application for an installation that was completed during the 14 2021 calendar year. 15 The bill takes effect upon enactment and applies to the tax 16 year beginning on or after January 1, 2022, but before January 17 1, 2023. 18 -4- LSB 5571YH (8) 89 jm/jh 4/ 4