Taxation of SRECs?

[Grant]

Has anyone figured out the tax situation on SREC payments? Surely we
have an accountant or tax lawyer among us?

I've googled high and low, and no one in the industry will go on
record either way, nor does the IRS seem to have stated one way or
another.

My own reading is that this is the sort of thing that is supposed to
be taxable, but it's of a category that may be explicitly unenforced,
not unlike credit card rebates. It does not appear to be explicitly
untaxable like the up-front rebate payments.

OTOH, if it is taxable, then it is only appropriate to do it properly
and take the depreciation, operating expense deductions, and so forth,
just as if it was any other sort of revenue-producing property like an
accessory apartment. But that's a bit of a mess for what is
conceptually just a backwards light bulb or two.

The least bad discussion of the topic appears to be here:
http://www.srectrade.com/blog/srec/taxes

[Jim Elkind]

Grant,

As you suggest, an opinion from a tax advisor would be helpful.

I have been told that the SREC aggregator, Knollwood does not issue 1099s
for SREC income. If that turns out to be true, I would take that to be a
pretty strong indication of the tax regulations.

It would be great to hear from some professionals on this topic.

Jim Elkind
(m) 508-517-0800