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FAQ About Solar Incentives

1)What types of solar electric systems qualify for the 30% Federal Tax Credit?
  • ANY complete solar power package, for home or business.
  • Product purchases that expand your existing solar power system and include at least one solar panel.
  • Solar System for RV and boat that has been accepted by the IRS as a second home for tax purposes.

2)Some Facts Regarding Eligibility of the Federal Tax Credit

  • The home served by the system does not have to be the taxpayer’s principal residence.
  • If the federal tax credit exceeds your tax liability, the excess amount may be carried forward to the succeeding taxable year.
  • There is no ceiling on the tax credit.
  • Applies to equipment AND installation costs.
  • For Residential Renewable Energy Systems, use IRS Tax Form 5695 to report your expenses. (It can be used for any residence, not just your primary one.)
  • Commercial systems have similar guidelines as residential systems but use IRS Tax Form 3468.

Every individual's tax situation is different. Please consult a tax professional to make sure your situation is applicable.

3)Federal Tax Credits in effect through 2021

In December 2015, the Consolidated Appropriations Act extended the 30% credit for residential solar to the end of 2019. It then steps down over two years and expires completely at the end of 2021.

  • 30% for systems placed in service by 12/31/2019
  • 26% for systems placed in service after 12/31/2019 and before 01/01/2021
  • 22% 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.

What Incentives Does Your State Offer?

Solar incentives vary from state to state, so you need to be sure about what your State is offering. Well we have made it easy, simply find your State on the map and click on it to see all the incentives that your State offers.

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