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Arkansas Natural Resources Commission Offers Water-Saving Incentives

on-farm reservoir

Arkansas landowners may be eligible for tax credits if they install improvements that conserve water — photo courtesy NRCS

The Arkansas Natural Resources Commission is offering financial incentives in the form of tax credits to state farmers and landowners who make land improvements that help conserve water.

Among the projects that may qualify are building surface water reservoirs, land leveling, converting from groundwater to surface water, and installing certain irrigation water measuring and control devices.

Tax Credit Percentages

Take reservoirs, for example. The commission will provide tax credits of up to 50 percent of the project or no more than $9,000 per year for a total of $90,000. An unused tax credit may be carried over for a maximum of 14 years.

The commission will provide a 10 percent tax credit on land leveling projects that conserve irrigation water. An unused tax credit may be carried over for a maximum of two years. The maximum amount one can claim for this project is $27,000.

For water meters, the commission is offering credits of 10 to 50 percent on devices installed on wells. The 10 percent is outside a critical groundwater area, with the 50 percent within a critical groundwater area.

Important Caveats

An application must first be approved by your county conservation district, then submitted to the commission and approved before a taxpayer may begin construction and claim the credits.

Within three years of the issuance of your certificate of tax credit approval, the project must be completed, and you must submit an application for a certificate of completion to your local conservation district for final inspection.

Taxpayers may be eligible for a tax deduction in the amount equal to the difference between the project cost and the credit used.

All projects also must be maintained for at least 10 years after they are completed or the taxpayer may have to pay back the benefits.

For more information on the types of improvements covered, visit https://bit.ly/2GV8B5f. To find out more about the  application process and tax credits available, visit the Arkansas Natural Resources Commission at http://www. anrc.arkansas.gov.

Individuals looking to apply for the incentives are encouraged to contact their local conservation district.