Department of Taxation
LEED Certified Green Buildings
Pursuant to AB 621 of the 2007 Legislative Session, certain purchases of tangible personal property that become a fixture of/or an integral or inseparable part of a building that has been approved by the Nevada Office of Energy as meeting the qualifications of a LEED building, are exempt from any local taxes (but not the 2% state tax). There are currently 6 projects that have received LEED approval from the Office of Energy and they are all located in Clark County. Among them are the Echelon Place, Project CityCenter, Fontainebleau, and the Venetian Palazzo. Each project has been awarded a deferral certificate from the Department of Taxation. The certificate allows contractors or subcontractors to purchase building material exempt from tax, and then submit the 2% use tax directly to the Department of Taxation through a LEED tax return which is filed along with their regular return. The deferral certificate is provided to the developer who will in turn supply a copy to the contractor and subcontractors working the project.
Vendors selling tangible personal property may treat this certificate in much the same manner as a resale certificate. The vendor will not collect any tax on the sale of materials for use in building the LEED certified building. Each certificate has been assigned a registration number. The vendor must keep a copy of the deferral certificate to back-up the exempt sale and they must notate on the sales invoice or other documentation relating to the exempt transaction the LEED registration number.
Contractors and Subcontractors
When the developer or general contractor supplies the subcontractor the copy of the deferral certificate, they must also provide the subcontractor the 2% LEED tax return that must be used by the subcontractor to report the 2% use tax. These 2% LEED tax returns have the registration number of the project at the bottom so the Department can keep track of the purchases and amounts exempted. Should the building fail to fully meet the LEED standard when it is completed, the developer would be responsible for the 5.75% additional use tax on the materials. A subcontractor may do work for more than one of these LEED projects, each one supplying him a separate 2%LEED tax return. The Subcontractor must file the separate 2% LEED tax return for each individual project along with their regular tax return. The amounts should not be combined. As mentioned above, pursuant to LCB File No. R-084-07, the exemption is restricted to purchases of tangible personal property that become an integral or inseparable part of the building. Examples include (but not limited to) concrete, sheet rock, paint or air conditioning parts, lighting fixtures, and flooring. Qualifying purchases are those occurring after 10/01/2005 through 12/31/2010.