Solar Tax Credit: Federal Extension Through 2019
When you are preparing to invest in a solar power system, it is smart to take advantage of the tax credits that might be available from the state or federal government. These programs are designed to incentivize people to install solar panels, helping to improve the clean energy initiatives across the nation.
What is the Investment Tax Credit (ITC)?
The federal solar tax credit is known as the Investment Tax Credit (ITC). It was created to allow taxpayers to deduct as much as 30% of the cost of solar installation on their federal tax filing. These credits are available to both homeowners and businesses that install solar electric systems. The savings add up to thousands of dollars in tax reductions, making it more affordable than ever to install a solar power system.
When the ITC was created, a deadline was set on these Federal tax credits. As a result, the tax credit benefits will be decreasing after 2019. If you are thinking about having solar installed at your home or business, then this year is the time to act so that you can maximize all of the tax credits that are available to you.
Keep in mind that the tax credits will be going down after the end of this year. But tax credits will continue to be offered in the future, just at a lesser percentage. You can consider the timeline that works best for your needs, then schedule the solar installation to match those needs.
Federal Tax Credits in the Future
Here is an overview of the structure of federal solar power tax credits:
- 30 Percent: Starting in 2016, 30% of the cost of the system could be used as tax credits. This rate applies through the end of 2019.
- 26 Percent: In 2020, the tax credit benefits drop to 26%.
- 22 Percent: These tax credits drop again in 2021, down to 22%.
- 10 Percent: From 2022 forward, the benefits for residential solar power are no longer available. Commercial solar energy systems will continue to have tax credits available at the rate of 10% of the cost of the system.
As you can see, waiting to have solar installed could cost you thousands of dollars in the future. Not only will you miss out on the maximum benefits of the federal tax credits, but you will also pay more than necessary for ongoing utility expenses. If you are ready to learn more about the benefits of solar power, then call New Day Solar at 855-444-6329 or you can visit us online at: www.newdaysolar.com. With 31 years of expertise, we will give you honest answers to your solar questions. Our team will help you choose the system that is best for you and your family’s energy needs. Don’t miss out on taking advantage of the 30% tax credit.