30% Federal Tax Credit Details
The Investment Tax Credit (ITC) is a 30 percent federal tax credit for solar systems on residential and commercial properties that, under current law, remains in effect through December 31, 2016. The residential ITC is used for residential sized projects, and the homeowner applies the credit to his/her income taxes. This credit is used when homeowners purchase solar systems outright and have them installed on their homes. The commercial ITC is used for utility-scale and commercial sized projects.
The ITC for commercial and residential solar installations has been around since the Energy Policy Act of 2005 (P.L. 109-58) and was extended an extra 8 years thanks to the Emergency Economic Stabilization Act of 2008 (P.L. 110-343).
How does the ITC Work?
A tax credit is a dollar-for-dollar reduction in the income taxes that a person or company claiming the credit would otherwise pay the federal government. The ITC is based on the amount of investment or money spent on solar property. Both the commercial and residential ITC are credits equal to 30 percent of the gross cost of solar power equipment that is placed in service (turned on) before December 31, 2016.
The following list of products all qualify for the 30% tax credit and are all products that are readily available and viable investments for Florida. There are many more qualifying renewable energy sources and a more complete list of those items can be found here: Solar Tax Credit Info
- Solar Electricity
- Solar Hot Water
- Solar Pool Heating
- Solar Attic Fans
Click Here for a list of products available for your location.
Summary and Example
When you purchase solar power for your home or business, you are eligible for a 30% tax credit based on the total amount spent on solar. It is up to you to determine whether you can or cannot use the tax credit at the end of the year. We find that most people who are retired or are not working have a tough time using or qualifying for the tax credit. Most W-2 employees can take advantage of the tax credit very easily and may qualify for an increased refund check in the amount of the tax credit – as long as income/taxes paid can support this.
The tax credit has been helping people all over the USA install solar power with a Federal discount! This tax credit does expire at the end of 2016 (December 31, 2016) and you MUST have your solar power system installed and paid for in full before that deadline if you want to qualify for the tax credit. After the 2016 deadline, the tax credit is going to drop to 10% for commercial customers and 0% for residential customers.
If you purchased solar at $100,000, your tax credit would be 30% of $100,000 or $30,000.
Find Out How Much You Can Qualify For
Contact us today to get your free quote for your home or business. Our detailed quotes show you how much you’ll save from the tax credit and we can talk about the other financial incentives available to you!
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