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The United States federal government is currently offering an incentive for those people considering investing in renewable energy systems such as wind and solar. Called the "Investment Tax Credit", people who install solar power systems on their home will enjoy a 30% tax rebate off their federal tax obligation. To learn more, please continue reading this page.
Most states and many local governments and electric utilities have some sort of tax rebate or other incentive as well as net metering, respectively. Check with your local electricity provider on their net metering programs. For all incentives, please visti the Database of State Incentives for Renewables & Efficiency® and search your state.
The following solar electric systems will qualify for a 30% federal tax credit:
The Investment Tax Credit for solar and renewable energy installations HAS BEEN EXTENDED! What you should do NOW...
If you're thinking of adding solar power to your total energy solution, you should know that there are solar tax credits available for almost all 50 states. In most instances these tax credits are applied to your income tax at the time of filing.
A federal renewables Investment Tax Credit is also available. Currently, the federal credit is 30 percent of the total cost of installation. For example, if you install a solar power system for your residential dwelling and the cost is $22,000, the tax credit is 30 percent of that amount, or $6,600. This reduces the cost of your installation to $15,400. Add to that the fact that you'll be paying less for your utility costs, and it makes more and more sense to explore renewable energy options.
To make these incentives even more attractive, the federal solar tax credit is a dollar for dollar reduction in your taxes owed. In other words, if the 30 percent of your tax break amounts to $6,600, you get to take $6,600 off the taxes you owe. If you only owe $3,300 in taxes, the balance rolls over to the next year until the credit is exhausted.
Example of Residential Solar Power Savings
Investigate your state solar tax credits and rebates to save even more money. For instance, the state of California solar tax credit leads the way when it comes to incentives and support for renewable energy for both commercial and residential systems. Local utility companies also offer rebates for installing solar energy systems. In some instances you can combine the Federal and state solar power tax credits to save even more money.
Be aware that there are some restrictions regarding qualifications for some of these programs. The solar energy systems that you're installing must be done on existing homes that are your primary residence. Additionally, the energy tax credit does not apply to new construction. At the present time, however, there is no maximum amount on the credit you can receive as long as you meet all the requirements.
Some states offer property tax exemptions if you've installed solar energy systems in your primary residence, so be sure to check your local regulations. In addition, some electric companies offer what's called net-metering, which allows you a way to sell excess electricity back to the power company.
If you're thinking of adding a renewable energy system to your residence, be sure to check out all the solar power tax credits that are available today. When combining the tax savings and the reduced utility bills you will enjoy once your solar energy system is in place, it's never made more sense to begin reducing your carbon footprint.
A Short History of the Investment Tax Credit
The Economic Stabilization Act of 2008 (H.R. 1424) included the most recent extension of the solar investment tax credit. The law took effect on January 1, 2009.
Not only did H.R. 1424 improve the federal solar tax credit from a flat $2000 to 30% of total system and installation costs, it also extends the tax incentive for the next 8 years. But it gets better: H.R. 1424 extends tax incentives to utility companies and commercial installations!
Many businesses and residential homeowners have benefitted from the 30% Federal Solar Tax Credit since its passing! There was a substantial increase in the number of solar and wind power orders for residential and commercial projects. If you have been considering solar power as a solution to your energy needs but couldn't make it happen, YOU NOW HAVE MORE TIME! Now that the tax credit has been extended, we are sure to experience a rush on solar panels and supplies could become limited from now until well into 2017. SO ACT NOW!
Hightlights of the Federal Tax Credit Program
GOOD NEWS! The Investment Tax Credit HAS BEEN EXTENDED so START PLANNING AND ORDER NOW BEFORE THE RUSH TO GO SOLAR IN 2016!