Federal Solar Tax Credits
When homeowners go solar, they can benefit from federal solar tax credits.
What Is a Solar Tax Credit?
Tax credits are a reduction in income tax that you would owe otherwise. This is sometimes known as an Investment Tax Credit (ITC), but this differs from the ITC offered on solar panel systems. So, what are federal solar tax credits? The federal solar tax credit is a tax credit that you can claim on your taxes for a percentage of the cost of your solar panel system.
How Long Does the Federal Solar Tax Credit Last?
Congress passed an extension on the ITC back in December 2020. This offers a 26% solar tax credit for solar panels systems that are installed between the years 2020-2022, and then 22% solar tax credit for systems installed in 2023. The federal solar tax credit expires in 2024 unless Congress passes on another extension, which they’ve been shown to do in the past. Additionally, there is no maximum to what can be claimed.
Does My System Qualify for Federal Solar Tax Credit?
The definition of a qualified solar panel system is that your system must be installed for service during the tax year, and it must produce electricity for a home in the United States (foreign real estate doesn’t qualify). What does installed for service mean? There is no test from the IRS, but it simply means a completed installation.
There are additional expenses associated with a solar panel installation, so many people ask if these expenses are included in the federal solar tax credit.
If you meet the following, you might be eligible for the federal solar tax credit:
Here are some of the things that are included:
Why is the Federal Solar Tax Credit Important?
Because the federal solar tax credit benefits homeowners who switch to solar energy, it has become a driving force to incentivize switching to clean energy in the United States. Solar has grown a lot over the decades, and it is still going strong. The federal solar tax credit has done a lot to promote solar energy. This policy has provided long-term stability, and in return, this has allowed businesses to drive down costs. Because of this, companies like Sparrow Electric can offer customers a new way to install a system through solar panel financing. The federal solar tax credit has been a great success, and we’re eager to see how this policy can keep us moving forward.
Our Solar Panel Financing Process
At Sparrow Electric, we streamline the financing process so that you’re able to benefit from solar panels on your home. Here’s how it works:
Help You with the Financing
Contact Sparrow Electric and we can help you get approved for solar panel financing.
Install Your Solar Panel System
Install Your Solar Panel System: When you get approved for financing, we start the installation process
Benefit from Solar Savings
After the installation, you’ll take advantage of solar savings.
Getting a Solar Panel System is Easier than Before
At Sparrow Electric, we provide homeowners with the ability to install solar panels for your home with no upfront costs. When there’s solar panel financing available, more and more people can take advantage of renewable energy and slash their power bills. Sparrow Electric helps you with solar panel financing with no upfront costs for the most advanced solar panel systems on the market.