Solar Tax Credits
In the past few years, the overall cost of installing solar energy systems has reduced drastically while the popularity of the systems has outwardly increased. Many home and business owners have turned to solar energy systems as a means of not only providing the electricity needed but as a way to not only save money but contribute to a greener environment. In addition to reduced solar energy system installation costs, there are a number of tax credits that are offered to consumers as well, making solar energy systems a very practical and affordable option for many home and business owners. Tax credits are income tax reductions that are calculated at the end of the year and can be taken by both residential and commercial property owners. One of the most popular tax credits offered to consumers today is that of the Solar Investment Tax Credit, often referred to as the ITC.
Solar Investment Tax Credit
Here at NRG Consultants, we want to make sure that our valued residential and commercial clients are familiar with the Solar Investment Tax Credit and how it can be used. What is the solar investment tax credit? It is, in essence, a federal tax. Solar Investment Tax Credits can be claimed by consumers who have purchased a solar PV system for installation at their home or business property. Your brand-new solar energy system (not used solar panels) must be installed here in the U.S. only (not out of the country) within the same tax year to take advantage of the Solar Investment Tax Credit. The way the credit works is that a percentage of the money paid for the system or any of the many system expenses is deducted from your income tax filing at year’s end. The percentage varies from year to year, and consumers can find the current percentage rates on the U.S. Department of Energy website.
Several solar system expenses can also be claimed at tax filing time that include but are not limited to the solar photovoltaic panels, wires, mounting devices, inverters, energy storage devices, and even costs for assembly and installation, and both developer and inspection fees. The tax credit can only be claimed by the home or business owner who actually owns the solar energy system and not by individuals or businesses who rent solar energy systems.
Eligibility for the Tax Credit
Home or business owners who pay federal taxes are eligible for the Solar Investment Tax Credit and any other solar related tax credits as well. Additionally, to qualify for solar tax credits of any type, your brand new installed solar panels must have been installed at your primary home or your secondary home as well, between the dates of January 1, 2006, and December 31, 2021. The tax credits are also allowed for commercial property owners who have invested in a new solar PV system.
To learn more about the many tax credits available today for solar energy systems, whether for a residential or commercial property, be sure to reach out to our team of highly skilled and experienced consultants, designers, and installers today to schedule your free solar energy consultation. Our team is on hand to discuss design and costs and answer any questions you may have. Don’t delay. Reach out to our team today!