{"data":{"id":"us-ok/okla.-stat.-tit.-68-68-2357.32a","jurisdiction":"us-ok","citation":"Okla. Stat. tit. 68, § 68-2357.32A","heading":"Electricity generated by zero-emission facilities -","body":"Tax credit.\n\nA. Except as otherwise provided in subsection H of this\n\nsection, for tax years beginning on or after January 1, 2003, but\n\nwith respect to tax credits for eligible renewable resources\n\ndescribed by subparagraphs b, c and d of paragraph 2 of this\n\nsubsection, for tax years ending not later than December 31, 2021,\n\nthere shall be allowed a credit against the tax imposed by Section\n\n2355 of this title to a taxpayer for the taxpayer's production and\n\nsale to an unrelated person of electricity generated by zero-\n\nemission facilities located in this state. As used in this section:\n\n1. \"Electricity generated by zero-emission facilities\" means\n\nelectricity that is exclusively produced by any facility located in\n\nthis state with a rated production capacity of one megawatt (1 mw)\n\nor greater, constructed for the generation of electricity and placed\n\nin operation after June 4, 2001, and with respect to electricity\n\ngenerated by wind for any facility placed in operation not later\n\nthan July 1, 2017, which utilizes eligible renewable resources as\n\nits fuel source. The construction and operation of such facilities\n\nshall result in no pollution or emissions that are or may be harmful\n\nto the environment, pursuant to a determination by the Department of\n\nEnvironmental Quality; and\n\n2. \"Eligible renewable resources\" means resources derived from:\n\na. wind,\n\nb. moving water,\n\nc. sun, or\n\nd. geothermal energy.\n\nB. For facilities placed in operation on or after January 1,\n\n2003, and before January 1, 2007, the amount of the credit for the\n\nelectricity generated on or after January 1, 2003, but prior to\n\nJanuary 1, 2004, shall be seventy-five one-hundredths of one cent\n\n($0.0075) for each kilowatt-hour of electricity generated by zero-\n\nemission facilities. For electricity generated on or after January\n\n1, 2004, but prior to January 1, 2007, the amount of the credit\n\nshall be fifty one-hundredths of one cent ($0.0050) per kilowatt-\n\nhour for electricity generated by zero-emission facilities. For\n\nelectricity generated on or after January 1, 2007, but prior to\n\nJanuary 1, 2012, the amount of the credit shall be twenty-five one-\n\nhundredths of one cent ($0.0025) per kilowatt-hour of electricity\n\ngenerated by zero-emission facilities. For facilities placed in\n\noperation on or after January 1, 2007, and before January 1, 2021,\n\nor with respect to electricity generated by wind for any facility\n\nplaced in operation not later than July 1, 2017, the amount of the\n\ncredit for the electricity generated on or after January 1, 2007,\n\nshall be fifty one-hundredths of one cent ($0.0050) for each\n\nkilowatt-hour of electricity generated by zero-emission facilities.\n\nC. Credits may be claimed with respect to electricity generated\n\non or after January 1, 2003, during a ten-year period following the\n\ndate that the facility is placed in operation on or after June 4,\n\n2001.\n\nD. 1. For credits generated prior to January 1, 2014, if the\n\ncredit allowed pursuant to this section exceeds the amount of income\n\ntaxes due or if there are no state income taxes due on the income of\n\nthe taxpayer, the amount of the credit allowed but not used in any\n\ntax year may be carried forward as a credit against subsequent\n\nincome tax liability for a period not exceeding ten (10) years.\n\n2. Except as provided by paragraph 3 of this subsection, for\n\ncredits generated, but not used, on or after January 1, 2014, the\n\nOklahoma Tax Commission shall refund, at the taxpayer's election,\n\ndirectly to the taxpayer eighty-five percent (85%) of the face\n\namount of such credits. The direct refund of the credits pursuant\n\nto this paragraph shall be available to all taxpayers, including,\n\nwithout limitation, pass-through entities and taxpayers subject to\n\nSection 2355 of this title, but shall not be available to any\n\nentities falling within the provisions of subsection E of this\nection,\n\ndirectly to the taxpayer eighty-five percent (85%) of the face\n\namount of such credits. The direct refund of the credits pursuant\n\nto this paragraph shall be available to all taxpayers, including,\n\nwithout limitation, pass-through entities and taxpayers subject to\n\nSection 2355 of this title, but shall not be available to any\n\nentities falling within the provisions of subsection E of this\n\nsection. The amount of any direct refund of credits actually\n\nreceived at the eighty-five percent (85%) level by the taxpayer\n\npursuant to this paragraph shall not be subject to the tax imposed\n\nby Section 2355 of this title. If the pass-through entity does not\n\nfile a claim for a direct refund, the pass-through entity shall\n\nallocate the credit to one or more of the shareholders, partners or\n\nmembers of the pass-through entity; provided, the total of all\n\ncredits refunded or allocated shall not exceed the amount of the\n\ncredit or refund to which the pass-through entity is entitled. For\n\nthe purposes of this paragraph, \"pass-through entity\" means a\n\ncorporation that for the applicable tax year is treated as an S\n\ncorporation under the Internal Revenue Code of 1986, as amended,\n\ngeneral partnership, limited partnership, limited liability\n\npartnership, trust or limited liability company that for the\n\napplicable tax year is not taxed as a corporation for federal income\n\ntax purposes.\n\n3. With respect to credits claimed for the first time on or\n\nafter July 1, 2019, or the effective date of this act, whichever\n\ndate last occurs, a taxpayer may irrevocably elect to not receive a\n\ndirect refund for a given tax year. Any credits not directly\n\nrefunded may be carried forward as a credit against subsequent\n\nincome tax liability for a period not exceeding ten (10) years. If\n\na taxpayer makes the irrevocable election to carry over credits for\n\na given tax year pursuant to this paragraph, any credits remaining\n\nin the tenth year of carry forward shall be refunded at eighty-five\n\npercent (85%).\n\nE. Any nontaxable entities, including agencies of the State of\n\nOklahoma or political subdivisions thereof, shall be eligible to\n\nestablish a transferable tax credit in the amount provided in\n\nsubsection B of this section. Such tax credit shall be a property\n\nright available to a state agency or political subdivision of this\n\nstate to transfer or sell to a taxable entity, whether individual or\n\ncorporate, who shall have an actual or anticipated income tax\n\nliability under Section 2355 of this title. These tax credit\n\nprovisions are authorized as an incentive to the State of Oklahoma,\n\nits agencies and political subdivisions to encourage the expenditure\n\nof funds in the development, construction and utilization of\n\nelectricity from zero-emission facilities as defined in subsection A\n\nof this section.\n\nF. For credits generated prior to January 1, 2014, the amount\n\nof the credit allowed, but not used, shall be freely transferable at\n\nany time during the ten (10) years following the year of\n\nqualification. Any person to whom or to which a tax credit is\n\ntransferred shall have only such rights to claim and use the credit\n\nunder the terms that would have applied to the entity by whom or by\n\nwhich the tax credit was transferred. The provisions of this\n\nsubsection shall not limit the ability of a tax credit transferee to\n\nreduce the tax liability of the transferee, regardless of the actual\n\ntax liability of the tax credit transferor, for the relevant taxable\n\nperiod. The transferor initially allowed the credit and any\n\nsubsequent transferees shall jointly file a copy of any written\n\ntransfer agreement with the Oklahoma Tax Commission within thirty\nree to\n\nreduce the tax liability of the transferee, regardless of the actual\n\ntax liability of the tax credit transferor, for the relevant taxable\n\nperiod. The transferor initially allowed the credit and any\n\nsubsequent transferees shall jointly file a copy of any written\n\ntransfer agreement with the Oklahoma Tax Commission within thirty\n\n(30) days of the transfer. The written agreement shall contain the\n\nname, address and taxpayer identification number or Social Security\n\nnumber of the parties to the transfer, the amount of the credit\n\nbeing transferred, the year the credit was originally allowed to the\n\ntransferor, and the tax year or years for which the credit may be\n\nclaimed. The Tax Commission may promulgate rules to permit\n\nverification of the validity and timeliness of the tax credit\n\nclaimed upon a tax return pursuant to this subsection but shall not\n\npromulgate any rules that unduly restrict or hinder the transfers of\n\nsuch tax credit. The tax credit allowed by this section, upon the\n\nelection of the taxpayer, may be claimed as a payment of tax, a\n\nprepayment of tax or a payment of estimated tax for purposes of\n\nSection 1803 or Section 2355 of this title.\n\nG. For electricity generation produced and sold in a calendar\n\nyear, the tax credit allowed by the provisions of this section, upon\n\nelection of the taxpayer, shall be treated and may be claimed as a\n\npayment of tax, a prepayment of tax or a payment of estimated tax\n\nfor purposes of Section 2355 of this title on or after July 1 of the\n\nfollowing calendar year.\n\nH. No credit otherwise authorized by the provisions of this\n\nsection may be claimed for any event, transaction, investment,\n\nexpenditure or other act occurring on or after July 1, 2010, for\n\nwhich the credit would otherwise be allowable until the provisions\n\nof this subsection shall cease to be operative on July 1, 2011.\n\nBeginning July 1, 2011, the credit authorized by this section may be\n\nclaimed for any event, transaction, investment, expenditure or other\n\nact occurring on or after July 1, 2010, according to the provisions\n\nof this section. Any tax credits which accrue during the period of\n\nJuly 1, 2010, through June 30, 2011, may not be claimed for any\n\nperiod prior to the taxable year beginning January 1, 2012. No\n\ncredits which accrue during the period of July 1, 2010, through June\n\n30, 2011, may be used to file an amended tax return for any taxable\n\nyear prior to the taxable year beginning January 1, 2012.\n\nI. For tax years beginning on or after January 1, 2019, the\n\ntotal amount of credits authorized by this section with respect to\n\neligible renewable resources described by subparagraphs b, c and d\n\nof paragraph 2 of subsection A of this section used to offset tax or\n\npaid as a refund shall be adjusted annually to limit the annual\n\namount of credits to Five Hundred Thousand Dollars ($500,000.00).\n\nThe Tax Commission shall annually calculate and publish a percentage\n\nby which the credits authorized by subparagraphs b, c and d of\n\nparagraph 2 of subsection A of this section shall be reduced so the\n\ntotal amount of credits used to offset tax or paid as a refund does\n\nnot exceed Five Hundred Thousand Dollars ($500,000.00) per year.\n\nThe formula to be used for the percentage adjustment shall be Five\n\nHundred Thousand Dollars ($500,000.00) divided by the credits\n\nclaimed in the second preceding year.\n\nJ. Pursuant to subsection I of this section, in the event the\n\ntotal tax credits authorized by this section with respect to\n\neligible renewable resources described by subparagraphs b, c and d\n\nof paragraph 2 of subsection A of this section exceed Five Hundred\n\nThousand Dollars ($500,000.00) in any calendar year, the Tax\n\nCommission shall permit any excess over Five Hundred Thousand\n\nDollars ($500,000.00) but shall factor such excess into the\nin the event the\n\ntotal tax credits authorized by this section with respect to\n\neligible renewable resources described by subparagraphs b, c and d\n\nof paragraph 2 of subsection A of this section exceed Five Hundred\n\nThousand Dollars ($500,000.00) in any calendar year, the Tax\n\nCommission shall permit any excess over Five Hundred Thousand\n\nDollars ($500,000.00) but shall factor such excess into the\n\npercentage adjustment formula for subsequent years.\n\nK. Any credits authorized by this section with respect to\n\neligible renewable resources described by subparagraphs b, c and d\n\nof paragraph 2 of subsection A of this section not used or unable to\n\nbe used because of the provisions of subsection I or J of this\n\nsection may be carried over until such credits are fully used.\n\nL. The Tax Commission shall prepare an annual report and submit\n\nit to the Office of the State Secretary of Energy and Environment,\n\nthe Governor, the Speaker of the Oklahoma House of Representatives\n\nand the President Pro Tempore of the Oklahoma State Senate\n\nsummarizing the amount of credits allowed pursuant to subparagraphs\n\nb, c and d of paragraph 2 of subsection A of this section. The\n\nSecretary of Energy and Environment shall submit recommendations for\n\nchanges to the tax credit to the Governor, the Speaker of the\n\nOklahoma House of Representatives and the President Pro Tempore of\n\nthe Oklahoma State Senate within sixty (60) days after receipt of\n\nthe report from the Oklahoma Tax Commission.","path":["OK Code","Title 68"],"source_url":"https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os68.pdf","current_through":"2026-08-14","vintage":"open-us-law v2026.08, retrieved 2026-09-14","retrieved_at":"2026-09-14T18:32:36Z","sha256":"28342923cef1f906c13c8f1ed8060916c6efaa75a13a1d8bebbb73e9ef768aae","source_id":"us-ok","stale":false,"prev":"us-ok/okla.-stat.-tit.-68-68-2357.324","next":"us-ok/okla.-stat.-tit.-68-68-2357.4"},"notice":"GroundRules: Original legal text. Not legal advice."}