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Sales and Use Tax Exemption for Electrical Generating Equipment

Eligibility 
Commercial
Industrial
Residential
Savings Category 
Photovoltaics
Program Info
State 
Indiana
Program Type 
Sales Tax Incentive
Provider 
Indiana Department of Revenue

In Indiana, transactions involving manufacturing machinery, tools, and equipment are exempt from the state gross retail tax if the property is used for the production of tangible personal property, which includes electricity. Therefore, equipment, machinery, and tools used in the production of renewable electricity may also be eligible for this exemption.

In 2009, the Indiana Department of Revenue (DOR) issued a ruling specifically for wind turbines, clarifying that the foundation, tower, nacelle, gearbox, generator, yaw motors, blades and related component parts are all exempt from the state sales and use tax. However, the DOR ruled that that any "property which consists of or becomes part of a transformer in an electrical interconnection system for a wind turbine" are taxable.

The DOR has not ruled on the specific components of other renewable energy systems.