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Wisconsin Exemption for Renewable Energy Products


 Wisconsin DOR explains new sales and use tax exemption for renewable energy products and electrical contractors.

Effective April 1, 2013, Wisconsin allows electrical contractors an exemption for their purchases of renewable energy products. This exemption is explained on page 17 of the recently updated Department of Revenue publication: Electrical Contractors: How Do Wisconsin Sales and Use Taxes affect Your Business?

Exempt Renewable Energy Products:

A renewable energy product is exempt from sales and use tax if it meets the following criteria:

  • Its power is wind energy, direct radiant energy received from the sun, or gas generated from the anaerobic digestion of animal manure and other agricultural waste; and
  • It produces at least 200 watts of alternating current or at least 600 British thermal units per day.

Products eligible for this exemption include, but are not limited to:

  • Wind turbine generators;
  • Gas powered electrical generators, furnaces, space heaters, and water heaters;
  • Photovoltaic cells, modules and arrays;
  • Solar thermal collectors;
  • Inverters used to transform direct current produced from a wind, gas, or solar powered generator into alternating current;
  • Products that connect the inverter to the generator; and
  • Hardware required for the installation of a wind, gas or solar powered product.

Products NOT eligible for the exemption include:

  • Foundations;
  • Property that consumes electricity or heat (even if the electricity or heat is produced by a renewable energy product);
  • Property that conveys, transfers or alters the alternating current or heat (even if the electricity or heat is produced by a renewable energy product); and
  • Property used to store electricity or heat (even if the electricity or heat is produced by a renewable energy product).

Examples:

To stave off bewilderment, the Wisconsin Department of Revenue has included the following explanatory examples:

  1. A concrete foundation on which a solar tracking device is installed: not exempt.
  2. A tank used to store water heated by a solar collector: not exempt.
  3. Batteries used to store electricity produced by photovoltaic cells: not exempt.

Additional information is available at Wisconsin Adm. Code Tax 11.10.

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Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.