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Residential cost basis and subsidized PV

Around 3 AM, it occurred to me that I don't know the answer to this question, and I'll need to know it eventually: We put a solar electric (PV) system on our home in 2001. Say it cost around $33k. This is in California, and the CA Energy Commission reimbursed us around $14k. And then we got another $3k CA income tax credit. So my question is this: By how much did our cost basis go up? $16k? (both CEC rebate and tax credit count) $19k? (tax credit doesn't count) $30k? (CEC rebate doesn't count) $33k? (neither rebate nor credit count)

I've been assuming that the number is $16k, since that's what I'm out-of-pocket. Any other opinions?

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Reply to
NoSuchPerson
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Nobody wants to venture an opinion? Really?

Reply to
NoSuchPerson

Well, things ARE slow sometimes with the bulletin board(s).

But yes, I'll agree with you; basis being 16.

ChEAr$, Harlan Lunsford, EA n LA

Reply to
Harlan Lunsford

What were the federal tax implications?

If the CEC rebate isn't taxable, then it reduces the increase in basis. The CA income tax credit _is_ federally taxable, so I don't know; it should reduce the CA basis, but not the federal basis (or perhaps reduce the federal basis by its after-tax value). Seth

Reply to
Seth

Ah, THAT makes sense: If a rebate/credit was taxed, then it's inappropriate to use it to decrease the basis. Since the CA tax credit was federally taxed, then perhaps the federal basis for the house is higher (by the amount of the credit) than the CA basis. Thanks for the insight!

Reply to
NoSuchPerson

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