Federal Solar Tax Credit

Do You qualify for the solar tax credit?

As long as you own your solar energy system, you are eligible for the solar tax credit.

Understand however that leasing a system would not be eligible. Since you do not own system.

The best time to get solar is now.

The reason being the 30{c1ab367c3bd290a2bb901798f5c151f3ea19c302d19090280704ee30dbbab1d1} tax credit is only available through till December 31, 2019. After that, for the year 2020 the percentage will step down to 26{c1ab367c3bd290a2bb901798f5c151f3ea19c302d19090280704ee30dbbab1d1}. Then for the following year 2021 the percentage will be reduced again, and then will no longer be available for residential.

According to Energy.Gov

Note: The Bipartisan Budget Act of 2018, signed in February 2018, reinstated the tax credit for fuel cells, small wind, and geothermal heat pumps. The tax credit for all technologies now features a gradual step down in the credit value.

A taxpayer may claim a credit of 30{c1ab367c3bd290a2bb901798f5c151f3ea19c302d19090280704ee30dbbab1d1} of qualified expenditures for a system that serves a dwelling unit located in the United States that is owned and used as a residence by the taxpayer. Expenditures with respect to the equipment are treated as made when the installation is completed. If the installation is at a new home, the “placed in service” date is the date of occupancy by the homeowner. Expenditures include labor costs for on-site preparation, assembly or original system installation, and for piping or wiring to interconnect a system to the home. If the federal tax credit exceeds tax liability, the excess amount may be carried forward to the succeeding taxable year. The maximum allowable credit, equipment requirements and other details vary by technology, as outlined below.

Solar-electric property

  • 30{c1ab367c3bd290a2bb901798f5c151f3ea19c302d19090280704ee30dbbab1d1} for systems placed in service by 12/31/2019

  • 26{c1ab367c3bd290a2bb901798f5c151f3ea19c302d19090280704ee30dbbab1d1} for systems placed in service after 12/31/2019 and before 01/01/2021

  • 22{c1ab367c3bd290a2bb901798f5c151f3ea19c302d19090280704ee30dbbab1d1} for systems placed in service after 12/31/2020 and before 01/01/2022

  • There is no maximum credit for systems placed in service after 2008.

  • Systems must be placed in service on or after January 1, 2006, and on or before December 31, 2021.

  • The home served by the system does not have to be the taxpayer’s principal residence.

taken from  https://www.energy.gov/savings/residential-renewable-energy-tax-credit.

Kristina Gallant