TechBiiTechBii
  • Android
  • Computer Tips
  • How To Guides
  • SEO
  • WordPress
  • Content Writing
  • Tech News
Search
Categories
Reading: A Guide to Federal Solar Power Tax Credits
Share
Font ResizerAa
TechBiiTechBii
Font ResizerAa
Search
Follow US
Tech Stuff

A Guide to Federal Solar Power Tax Credits

Sidharth
Last updated: July 30, 2021 10:38 am
Sidharth
Published July 30, 2021
Share
4 Min Read

Table of Contents
What Is the Solar Power Federal Tax Credit?Who Is Eligible for the Solar Tax Credit?What Costs Does the Solar Tax Credit Cover?Claim Your Tax Credit to Save Money on Solar Energy

If you are considering installing solar panels on your home, there are federal and state incentives that can save you money on the installation cost.

The solar power federal tax credit is one way that the government is encouraging people to make the switch to solar energy. It aims to support the development of the solar industry as part of efforts to reduce carbon emissions.

What is the solar investment tax credit (ITC) and how does it work? Read on to find out what you need to know.

What Is the Solar Power Federal Tax Credit?

The investment tax credit for solar power subsidizes the cost of buying and installing a solar energy system to encourage uptake. It allows homeowners and businesses to claim a tax reduction in the year the system goes into service.

The ITC launched in 2005 for an initial two-year period. It has proved so popular Congress has extended it several times, most recently from 2020 to 2023. The size of the tax rebate has changed over time. For 2020-2022 the rate is 26% but it will fall to 22% in 2023. In 2024, it will be phased out for residential properties and fall to 10% for commercial properties.

The Biden administration is proposing a solar power tax credit extension, although this has yet to receive approval from Congress.

Who Is Eligible for the Solar Tax Credit?

You are eligible to receive federal solar power tax credits if you pay federal income taxes and purchase and install a new solar energy system on your property before the current deadline. The system must be installed either at your primary or secondary residence or on an off-site community project.

If you have already paid your taxes through your paycheck, you will receive a refund. You could use the refund to pay the balance on a loan if you took one out to pay for the solar energy system. If you have any tax credit remaining, you can carry it forward and apply it to the following year’s taxes.

What Costs Does the Solar Tax Credit Cover?

You can claim the solar power federal tax credit to cover the cost of not only the solar panels but the other costs associated with installing the system. The expenses the incentive covers include the following.

  • Solar panels
  • Solar cells powering an attic fan
  • Contractor costs for preparing and installing the system
  • System equipment, such as inverters and wiring
  • Energy storage systems connected to the solar panels
  • Sales tax on expenses

An energy storage system is eligible for the tax credit even if it is installed in a subsequent tax year to the solar panels. Contact your local solar installer for a free estimate of the costs for your property to see how much you can save.

Claim Your Tax Credit to Save Money on Solar Energy

The solar power federal tax credit helps you save on the cost of installing solar panels on your property, putting it within the reach of more homes and businesses.

In some places, you can also claim state tax credits and you can sell surplus electricity you generate to your local utility. Be sure to do your research to find out if these incentives are also available to you.

Check out the rest of the blog for more articles on the latest technologies.

Share This Article
Facebook Pinterest Whatsapp Whatsapp LinkedIn Reddit Telegram Threads Email Copy Link Print
Share
BySidharth
Follow:
Professional Blogger. Android dev. Audiophile.
Previous Article gamer pc Guide Before Buying Your First Gaming PC
Next Article internet data cable wire How do I connect to MI drop?
Leave a Comment

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

You Might Also Like

pmp exam
Tech Stuff

4 Advices for the PMP Exam Prep

May 18, 2021
Excel into PDF save.png
Tech Stuff

Making Your Excel Spreadsheets into PDF Save Easily – A Complete Guide!

February 25, 2022
robot machine ai
Tech Stuff

The Role of Robotics in Improving Logistics and Supply Chain Efficiency

May 16, 2022
Tech Stuff

Backblaze Cloud Storage Options: Secure and Restore Business Data

May 19, 2021
FacebookLike
XFollow
PinterestPin
LinkedInFollow
  • Contact Us
  • Submit Guest Post
  • Advertisement Opportunities
Copyright © 2012-2024 TechBii. All Rights Reserved
adbanner
Welcome Back!

Sign in to your account

Username or Email Address
Password

Lost your password?