SOLAR INVESTMENT TAX CREDIT



In October 2008, the Energy Improvement and Extension Act of 2008 extended solar tax credits until December 31, 2016. In February 2009, The American Recovery and Reinvestment Act of 2009 removed the maximum credit amount for all eligible technologies (except fuel cells) placed in service after 2008.

Here is a summary of the current Solar Investment Tax Credit:

A taxpayer may claim a credit of 30% of qualified expenditures for a system that serves a dwelling unit located in the U.S. 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 on a new home, the "placed in service" date is the date of occupancy by the homeowner. Expenditures include labor costs for onsite 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

·         There is no maximum credit for systems placed in service after 2008 (The maximum credit is $2,000 for systems placed in service before January 1, 2009.)
·         Systems must be placed in service from January 1, 2006, through December 31, 2016.
·         The home served by the system does not have to be the taxpayer’s principal residence.

Visit the DSIRE web page describing the Federal Residential Renewable Energy Tax Credit.
 

Note: RV's have been accepted by the IRS as a second home for tax purposes. This makes your RV eligible for this tax credit. As always, consult with your Tax adviser or CPA to make sure this applies to you and your situation.

Download IRS Form F5695(PDF)