Solar companies want an Arizona court to overturn state tax officials' decision that property taxes must be paid on leased rooftop panels that produce electricity.
SolarCity Corp. and Sunrun Inc. filed a lawsuit Monday against the state Department of Revenue's 2013 decision that leased panels don't get an exemption that applies to panels owned by homeowners or businesses.
The department said the homeowners' leased panels are subject to taxes like renewable energy generation equipment owned by utilities.
If upheld, the department's decision would subject homeowners with leased panels to property taxes because the leases have provisions passing any taxes to the homeowners.
The leasing companies say they're being incorrectly treated as electricity generators, not leasing companies.
Citing the pending litigation, department spokesman Sean Laux declined to comment on the suit.