In accordance with Code of Virginia, a tax credit is available for the purchase of

• machinery and equipment used predominantly in or on the premises of manufacturing facilities or plant units which manufacture, process, compound, or produce items of tangible personal property from recyclable materials, within the Commonwealth, for sale and
• machinery and equipment used predominantly in or on the premises of facilities that are predominantly engaged in advanced recycling.

The tax credit is equal to 20 percent of the original total capitalized cost of the purchase price for machinery and equipment for processing recyclable materials, and the total credit allowed cannot exceed 40 percent of the Virginia income tax liability in any taxable year.  The unused amount of the credit can be carried over for next 10 years. 

The DEQ is tasked with certifying eligible recycling equipment in accordance with the Code of Virginia. To obtain certification, submit DEQ Form 50-11S with supporting documents to the DEQ before March 1 for equipment purchased in the previous calendar year. 

The Virginia Department of Taxation is responsible for administering eligible tax credits for certified equipment. Per Taxation, to  apply for the tax credit, all eligible applicants who have received written certification from DEQ must file Form RMC with Virginia Tax on or before June 1. Please visit Department of Taxation's Tax Credit website for more details. 

For more information, please refer to DEQ's Guidance for the Certification of Recycling Machinery and Equipment for State Income Tax Credit. 

In accordance with Code of Virginia 58.1-3661, local governments in Virginia have the option of exempting or partially exempting DEQ certified recycling facilities and equipment from property taxes.

The Department of Environmental Quality has developed DEQ 50-11 Form to assist persons applying for the machinery and equipment certification, and to expedite the certification process. However, you are not required to use this form to apply for certification.

Once certified, the machinery and equipment may qualify for a local tax exemption based on current value assessment by taxing authority. Contact your local governing body for information.

In accordance with Code of Virginia 58.1-439.10, a tax credit is available for the purchase of equipment used exclusively for burning waste motor oil at a business facility that accepts waste motor oil from the public.

The tax credit is equal to 50 percent of the purchase price paid for equipment used exclusively for burning waste motor oil at the business facility. The total credit allowed to any taxpayer shall not exceed $5,000 and any credit shall be used only for the taxable year in which the purchase price of the waste oil burning equipment was paid. 

The DEQ is tasked with certifying eligible waste motor oil burning equipment in accordance with the Code of Virginia. To obtain certification, submit DEQ Form 50-12 with supporting documents to the DEQ. 

The Virginia Department of Taxation is responsible for administering eligible tax credits for certified equipment. Please visit Department of Taxation's Tax Credit website for more details. 

For more information, please refer to DEQ's Guidance for the Certification of Waste Motor Oil Burning Equipment for State Income Tax Credit.

In accordance with Code of Virginia 58.1-3660, certified pollution control equipment and facilities are declared a separate class of property and exempt from state and local taxation.  Retail sales and use taxes also do not apply to certified pollution control equipment and facilities in accordance with Code of Virginia 58.1-609.3. 

DEQ acts as the state certifying authority on behalf of the State Water Control Board for water pollution; the State Air Pollution Control Board, for air pollution; and the Virginia Waste Management Board, for waste disposal facilities, natural gas recovered from waste facilities, and landfill gas production facilities.

Applicability of this exemption to a specific project can be determined during project planning when preliminary discussions are held between the permit applicant and the pollution control agency.  Please contact the DEQ regional office where the facility is located.