Federal Solar Tax Credit
INSTALL YOUR SOLAR SYSTEM NOW TO EFFECTIVELY GET A 26% DISCOUNT!
The Solar Investment Tax Credit (ITC) was created by the Energy Policy Act of 2005; it set a tax credit of 30% of solar system costs for homeowners and commercial business owners who installed solar panels. The tax credit (not a write off, an actual credit to pay tax liability) remained at 30% until the end of 2019, at which point it dropped to 26%. The credit was scheduled to decrease again at the start of 2021 to 22%, but the federal spending package and COVID-19 virus relief spending bill passed in the final days of 2020 has extended the ITC to remain at 26% for 2021. It will stay at 26% through 2022, then the benefit will drop to 22% in 2023; after that it will go away completely for residential systems.
Here’s the breakdown of how the federal solar tax credit extension will works:
- 2021 - 2022: Tax credit of 26% of the solar system’s cost
- 2023: Tax credit of 22% of the solar system’s cost
- 2024: No more residential tax credit! Only commercial solar systems are eligible for 10% tax credit
To take advantage of this Federal Investment Tax Credit and to receive the full 26%, make sure your solar system is installed, operating, and approved well before Dec. 31, 2021 to apply the credit to your 2021 tax liability. Our team at HES Solar is ready and knowledgeable to help guide you through the process to ensure your system is up and running before the ITC deadline so that you get your maximum tax credit benefit
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*26% Tax credit is based on SDG&E final approval and inspection