Have you been considering making an investment in clean, renewable solar energy? Whether you’re a homeowner who is considering residential solar, or you’re a business owner or property manager who wants to invest in commercial solar, now is the opportune time to install solar and get the highest possible return on your investment. 2019 is the final year you can purchase solar and claim the full 30% Federal Solar Tax Credit.
The Federal Solar Tax Credit Explained
The Federal Solar Tax Credit, also known as the investment tax credit (ITC), was established by the Energy Policy Act of 2005 — which offers incentives for solar PV systems as well as other types of renewable energy systems. With this tax credit, individuals and entities who purchase and install a solar PV system can deduct 30% of the cost of their solar project from what they owe in federal taxes.
2019 Is the Final Year of the Full 30% Credit
The Federal Solar Tax Credit was extended back in 2015, allowing Americans to continue receiving federal solar tax incentives through 2022. However, the full 30% tax credit will sunset after this year, as follows:
2019: Owners of residential and commercial solar can claim a 30% tax credit
2020: Owners of residential and commercial solar can claim a 26% tax credit
2021: Owners of residential and commercial solar can claim a 22% tax credit
2022: Owners of residential and commercial solar can claim a 10% tax credit
2023 onwards: Only owners of commercial solar can claim a 10% tax credit
This means that if you wish to install solar panels and claim the full 30% tax credit, 2019 is your final year to do so.
How to Claim Your Federal Tax Credit
Claiming the Solar Tax Credit is easy when you install solar with an experienced solar installation company like Standard Energy Solutions. After gathering all of the documentation related to expenses for your solar project, simply fill out IRS Form 5695 and then add your solar credit amount to the standard IRS Form 1040.
One key thing to remember about the Federal Solar Tax Credit is that you must own your system in order to qualify for incentives. Leasing your system shifts tax benefits to the solar installer.
Learn More About Financing for Solar PV Systems
Are you considering solar but wonder “How long will it take for my solar panels to pay for themselves?” A number of factors will determine the ROI of your solar investment, including system size, property characteristics, current solar tariffs, and more. As your local solar installation company based in Columbia, MD, Standard Energy Solutions can help you break down the cost of solar — including available financing options to offset the upfront cost of solar.