Connecticut’s renewable energy sales tax exemption lets you buy qualifying solar, geothermal, and ice storage cooling systems — along with the labor to install them — free of the state’s 6.35% sales and use tax.1Justia. Connecticut Code 12-412 – Exemptions The exemption is written into Section 12-412(117) of the General Statutes, it has no sunset date and no annual cap, and it’s available to homeowners, businesses, contractors, and tenants. You claim it at the register by handing the seller a completed Form CERT-140 before you pay.
What Equipment Qualifies
Section 12-412(117)(A) exempts the following systems when you buy them for a Connecticut installation:1Justia. Connecticut Code 12-412 – Exemptions
- Solar electricity generating systems, including photovoltaic panels, inverters, racking, and related components
- Solar water and space heating systems, both passive and active, including specialized piping and heat exchangers
- Geothermal resource systems, including ground-source heat pumps and loop piping
- Equipment that is part of or directly connected to any of the above
A separate provision, Section 12-412(118), exempts ice storage cooling systems, meaning systems that make ice during off-peak hours and use it for air conditioning during peak demand.2Connecticut State Department of Revenue Services. SN 2007(7), 2007 Legislation Granting a Connecticut Sales and Use Tax Exemption There is a catch: only utility customers billed on a time-of-service metering basis can claim this one.1Justia. Connecticut Code 12-412 – Exemptions If your utility doesn’t bill you on a time-of-use rate, an ice storage system purchase is taxable.
Installation Labor Counts Too
Many buyers miss this. The exemption isn’t limited to hardware; it also covers the installation services for qualifying solar, geothermal, and ice storage systems.3Database of State Incentives for Renewables & Efficiency. Sales and Use Tax Exemption for Solar and Geothermal Systems The statute cross-references the installation services described in Conn. Gen. Stat. § 12-407(a)(37)(I).4Connecticut Department of Revenue Services. CERT-140 – Solar Heating Systems, Solar Electricity Generating Systems, and Ice Storage Cooling Systems On a $25,000 installation where labor is a significant share of the invoice, exempting that labor is real money. When you fill out the exemption certificate, describe both the equipment and the installation services.
Who Can Claim It
The exemption is available to contractors, property owners, and tenants.4Connecticut Department of Revenue Services. CERT-140 – Solar Heating Systems, Solar Electricity Generating Systems, and Ice Storage Cooling Systems In practice that covers:
- Homeowners buying a rooftop solar array or geothermal heat pump for their own property
- Businesses and commercial property owners installing solar or geothermal on their buildings
- Contractors and installers purchasing equipment on behalf of a client for a qualifying project
- Tenants installing qualifying systems with the landlord’s permission
When a contractor claims the exemption, the equipment has to be destined for a qualifying installation, and the certificate asks for the installation address if it’s known at the time of purchase.4Connecticut Department of Revenue Services. CERT-140 – Solar Heating Systems, Solar Electricity Generating Systems, and Ice Storage Cooling Systems
How to Claim the Exemption with Form CERT-140
You claim the exemption at the point of sale by giving the vendor a completed Form CERT-140, officially titled “Solar Heating Systems, Solar Electricity Generating Systems, and Ice Storage Cooling Systems.” The form is on the Connecticut Department of Revenue Services website.4Connecticut Department of Revenue Services. CERT-140 – Solar Heating Systems, Solar Electricity Generating Systems, and Ice Storage Cooling Systems You don’t send it to the state. The seller keeps it in their records as proof that the sale was legitimately tax-free.
The form asks for:
- Your name, address, Connecticut tax registration number if you have one, and federal employer ID number if applicable
- The vendor’s name, address, and Connecticut tax registration number
- Whether this is a blanket certificate covering ongoing purchases from that vendor or a one-time purchase
- A written description of each item being purchased, with checkboxes for the type of system
- The installation address, if known at the time of purchase
Be specific in the item description. “Solar equipment” invites trouble during an audit. “20 photovoltaic panels, one string inverter, aluminum roof-mount racking, and installation labor” gives the seller and any auditor a clear picture of what was exempted and why.
The declaration at the bottom carries real weight. You’re certifying under penalty of law that the information is true and correct. Deliberately filing a false certificate can bring a fine of up to $5,000, imprisonment of up to five years, or both.4Connecticut Department of Revenue Services. CERT-140 – Solar Heating Systems, Solar Electricity Generating Systems, and Ice Storage Cooling Systems
If You Already Paid the Tax
If you paid the 6.35% because you didn’t know about the exemption or forgot the certificate, you can still recover the money, but the process is awkward. You have to go back through the retailer. Specifically, you need the seller to complete Form AU-524, “Assignment of Retailer’s Rights for Refund,” on which they certify that they collected the tax, remitted it to the state, and are assigning their refund right to you. The Department of Revenue Services will not consider a refund claim from a purchaser unless a completed AU-524 from the retailer is included.5Connecticut State Department of Revenue Services. PS 98(5), Sales and Use Tax Refund Policy You’ll also need a completed CERT-140 and your purchase receipts.
Chasing a national retailer or an online seller for a signed form after the fact is often a losing battle. The simpler path by far is to have CERT-140 filled out and in hand before you buy.
What the Exemption Does Not Cover
Knowing the edges of this exemption matters as much as knowing what qualifies.
Standalone battery storage is not explicitly listed in Section 12-412(117). The statute names solar electricity generating systems, solar heating systems, and geothermal systems; batteries aren’t mentioned. A battery sold as part of an integrated solar system may fall under “equipment related to such systems,” but a home battery bought separately is a gray area. Ask the Department of Revenue Services in writing before assuming the exemption applies.
Wind power is handled differently. Residential wind turbines are not listed in subsection (A) alongside solar and geothermal. Wind appears in subsection (B), which is written for manufacturers and developers in the renewable energy industry rather than a homeowner buying a small turbine for personal use.6Connecticut State Department of Revenue Services. SN 2010(9.1), Exemption From Sales and Use Taxes for Items Used Directly in the Renewable Energy and Clean Energy Technology Industries Confirm with DRS before relying on the exemption for a residential wind purchase.
General electrical work that isn’t specific to the renewable energy system — such as upgrading your main service panel to accommodate solar — may not qualify. The exemption covers the systems and equipment “related to” them, not every peripheral home improvement triggered by the project.
How It Stacks with Other Incentives
The sales tax exemption is one piece of a shrinking set of financial supports. The federal Residential Clean Energy Credit under Section 25D, which covered 30% of the cost of a home solar or geothermal system, is not available for property placed in service after December 31, 2025.7Internal Revenue Service. Residential Clean Energy Credit Systems placed in service before that date can still be claimed on 2025 returns, but new residential installations completed in 2026 no longer qualify. For commercial installations, the federal Investment Tax Credit remains available, with a 6% base rate rising to 30% for projects meeting prevailing wage and apprenticeship requirements, and the full credit available for projects placed in service through the end of 2027.
On the Connecticut side, residential solar owners can enroll in the Residential Renewable Energy Solutions Program administered by the Public Utilities Regulatory Authority, which replaced legacy net metering in January 2022 and compensates grid-connected systems of 25 kW or smaller under 20-year tariff contracts.8Connecticut Public Utilities Regulatory Authority. Residential Renewable Energy Solutions Program The Connecticut Green Bank’s Smart-E Loan program offers below-market financing for solar and other home energy upgrades. None of these affect your CERT-140 claim; the sales tax exemption applies on top of whatever credits, tariffs, or financing you use.