{"id":1538,"date":"2019-06-18T06:01:04","date_gmt":"2019-06-18T06:01:04","guid":{"rendered":"http:\/\/genrenew.com\/?p=1538"},"modified":"2019-07-25T18:00:32","modified_gmt":"2019-07-25T18:00:32","slug":"what-you-need-to-know-about-the-30-federal-solar-tax-credit","status":"publish","type":"post","link":"https:\/\/genrenew.com\/what-you-need-to-know-about-the-30-federal-solar-tax-credit\/","title":{"rendered":"What You Need to Know About The 30% Federal Solar Tax Credit"},"content":{"rendered":"\n<p>The federal solar tax credit (also known as an investment tax credit or ITC) is a federal government tax incentive designed to encourage property owners to install solar energy systems in their homes. The incentive allows you to deduct 30% of the cost of setting up your solar energy system from your federal tax bill. The tax is open to both domestic homeowners and commercial property owners. Many property owners often wonder how to calculate this tax incentive. Here is how it works.<\/p>\n\n\n\n<p><strong>Who is Eligible?<\/strong><\/p>\n\n\n\n<p>All American taxpayers, whether businesses or individual are eligible as long as they have purchased a solar energy system or a solar system with an energy storage component. Individuals and companies who lease these systems are not eligible for the ITC because they do not own these systems. This benefit goes directly to the companies that lease out these solar energy systems. However, many such companies still factor these credits in the overall costing of the lease agreement so that the end user still benefits, albeit at a lesser magnitude than he or she had bought the panels.<\/p>\n\n\n\n<p><strong>How is ITC Calculated?<\/strong><\/p>\n\n\n\n<p>ITC calculations differ depending on a variety of factors. For homeowners, ITC is calculated on the net cost of installation after state rebates and other incentives have been factored in. If you example the total cost of your <a href=\"\/solar\/\">home solar energy system<\/a> is $20,000, and you got a rebate of $3,000 from your state, you can only calculate ITC on the $17,000 that remains after you deduct the state rebates. For commercial property owners, the process is a bit different. Here, the ITC is calculated before any other rebates are deducted. For example, if the $20,000 had been a commercial solar energy system, ITC would have been calculated on the whole amount ($20,000). While the ITC rate appears higher, the IRS considers the savings from deducting ITC on gross costs as \u2018earned income\u2019 which is subject to taxation. For this reason, the two deductions end up being roughly the same.<\/p>\n\n\n\n<p><strong>IS ITC Refundable?<\/strong><\/p>\n\n\n\n<p>If you don\u2019t owe the government any taxes, you would assume that the government\nwould pay you the 30% instead of offsetting in on your taxes. Unfortunately,\nITC is not a refundable tax. You can, however, claim it in subsequent years (up\nto five years after installation of the solar system) if you do end up paying\ntax to the federal government in subsequent years.<\/p>\n\n\n\n<p><strong>Timelines to Note<\/strong><\/p>\n\n\n\n<p>The ITC is set to decrease from 30% and drop steadily to 10% in three\nyears. This process is set to begin at the end of 2019. To calculate this tax,\nthe federal government requires that construction of the system be underway and\nat least 5% of the project and costs to have been built\/incurred before one can\nclaim this tax incentive. Initially, property owners could only claim tax\ncredits if the system was completed and fully functional. In recent changes,\ntax credits can be claimed before the project is finished on condition that the\nsolar system is fully operational by the end of 2023.\n\nHaving an effective\nsolar energy system starts with engaging the right contractor to install it.\nFor years, may property owners have trusted GenRenew for all their solar\ninstallations. Contact us today for a quote and take advantage of this\nfantastic incentive from the government. \n\n\n\n<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The federal solar tax credit (also known as an investment tax credit or ITC) is a federal government tax incentive designed to encourage property owners to install solar energy systems in their homes. The incentive allows you to deduct 30% of the cost of setting up your solar energy system from your federal tax bill. [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":1748,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_uf_show_specific_survey":0,"_uf_disable_surveys":false,"footnotes":""},"categories":[1],"tags":[],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.2 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>What You Need to Know About The 30% Federal Solar Tax Credit - GenRenew<\/title>\n<meta name=\"description\" content=\"The federal solar tax credit offers property owners tax credits on the cost of their solar energy system. Here is how ITC is calculated.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/genrenew.com\/what-you-need-to-know-about-the-30-federal-solar-tax-credit\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What You Need to Know About The 30% Federal Solar Tax Credit - GenRenew\" \/>\n<meta property=\"og:description\" content=\"The federal solar tax credit offers property owners tax credits on the cost of their solar energy system. 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