Solar Incentives

Initial costs of solar systems can be a big investment. we can save you up to 30% on that cost.

Homeowners Federal ITC

The 30% federal investment tax credit (ITC) is among the most important incentives currently available for anyone looking to purchase a solar power system.

Simply put, every dollar you invest in Solar power gets you 30% back in a tax credit!

The tax credit will also carry over into the following years if the credit exceeds your tax liability.

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WHAT IS A TAX CREDIT?

A tax credit is a dollar-for-dollar reduction in the amount of income tax you would otherwise owe. For example, claiming a $1,000 federal tax credit reduces your federal income taxes due by $1,000.
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WHAT EXPENSES ARE INCLUDED?

The following expenses are included:

Solar panels or PV cells, and any associated mounts or hardware.

Contractor labor costs for onsite preparation, assembly, or original installation, including permitting fees, inspection costs, and developer fees.

Balance-of-system equipment, including wiring, inverters, and mounting equipment.

‍Energy storage devices (batteries) that have a capacity rating of 3 kilowatt-hours (kWh) or greater.

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CAN I CLAIM THE ITC, ASSUMING I MEET ALL REQUIREMENTS, IF…

…I AM NOT A HOMEOWNER?

Yes. You do not necessarily have to be a homeowner to claim the tax credit. A tenant-stockholder at cooperative housing corporation and members of condominiums are still eligible for the tax credit if they contribute to the costs of an eligible solar PV system.

In this case, the amount you spend contributing to the cost of the solar PV system would be the amount you would use to calculate your tax credit. However, you cannot claim a tax credit if you are a renter and your landlord installs a solar system since you must be an owner of the system to claim the tax credit.

…I INSTALLED SOLAR PV ON MY VACATION HOME (LOCATED IN THE U.S.)?

Yes. Solar PV systems do not necessarily have to be installed on your primary residence for you to claim the tax credit.

…THE SOLAR PV PANELS ARE ON MY PROPERTY, BUT NOT ON MY ROOF?

Yes. The solar PV panels located on your property do not necessarily have to be installed on your roof, as long as it is generating electricity for use at your residence.

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WHAT IS THE SOLAR INVESTMENT TAX CREDIT?

August 2022, Congress passed an extension of the ITC, raising it to 30% for the installation of which was between 2022-2032. It will decrease to 26% for systems installed in 2033 and to 22% for systems installed in 2034. The tax credit expires starting in 2035 unless Congress renews it.

There is no maximum amount that can be claimed.
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AM I ELIGIBLE TO CLAIM THE INVESTMENT TAX CREDIT?

Your solar PV system was installed between January 1, 2017, and December 31, 2034.

The solar PV system is located at a residence of yours in the United Sta.E

Either:

--- You o (i.e., you purchased it with cash or through financing but you are neither leasing the system nor nor paying a solar company to purchase the electricity generated by the system). The solar PV system is new or being used for the first time by you.

--- You purchased an interest in an off-site community solar project, if the electricity generated is credited against, and does not exceed, your home’s electricity consumption. Notes: the IRS issued a statement allowing a particular taxpayer to claim a tax credit for purchasing an interest in an off-site community solar project. Also, you would not qualify if you only purchase the electricity from a community solar project.

The credit can only be claimed on the ” of the solar equipment.

WHAT IF THE TAX CREDIT EXCEEDS MY TAX LIABILITY? WILL I GET A REFUND?

This is a nonrefundable tax credit, which means you will not get a tax refund for the amount of the tax credit that exceeds your tax liability. However, you can carry over any unused amount of tax credit to the next tax year.

HOW DO I CLAIM THE ITC?

After seeking professional tax advice and ensuring you are eligible for the ITC, you can fill out and attach IRS Form 5695 to your federal tax return (Form 1040 or Form 1040NR).
Disclaimer: These factsheets provides an overview and does not constitute professional tax advice or other professional financial guidance. It should not be used as the only source of information when making purchasing decisions, investment decisions, or tax decisions, or when executing other binding agreements.
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