Solar Investment Tax Credit
The solar Investment Tax Credit (ITC), one of the most successful clean energy policies ever passed, has helped support a robust solar industry in the United States. Since the ITC was first passed in 2005 and enacted in 2006, it has helped the solar industry to grow by more than 10,000%, created hundreds of thousands of jobs, and resulted in billions of dollars invested in the U.S. economy.
Solar Panel Installation Cost Deduction
The ITC allows homeowners and businesses to deduct a percentage of the cost of installing a solar energy system from their federal taxes. Thanks to the ITC, people have saved thousands of dollars on solar and home battery installations. Numerous clients have told us that the ITC has made the difference, financially, in their ability to move forward on their solar projects.
The federal tax credit had, for many years, stood at 30% of the installation cost for a qualified installation. Unfortunately, the ITC was not extended by Congress (due to a threatened veto by President Trump) late last year and, now, has begun stepping down. This year, the credit is 26%; next year, it steps down to 22%. After 2021, there will be an ongoing 10% federal deduction for new commercial systems and zero tax credit for residential installations.
It is important to note that – as we head into a Biden presidency in 2021 – the Solar Energy Industries Association has indicated working on extending the ITC at 30%, including credit for energy storage, is its top priority. We are hopeful that SEIA can get things rolling in the right direction on this crucial renewable energy incentive.
So, in the meantime, what can you do to ensure some benefit from the solar ITC? Here are a few suggestions:
If you have not already, consider installing solar on your home (or business). For businesses, to you can obtain the credit in the year you commence construction, and for residential, you can obtain the credit in the year you complete your project. You will significantly reduce – if not nearly eliminate – your monthly power bill, decrease your carbon footprint, increase the value of your home or business, and help to reduce our dependence on fossil fuels. (If you already have solar, please encourage your friends and business associates to do the same!)
We hope you will become a member of the Florida Solar Energy Industries Association (FlaSEIA) – it costs just $25 and will help to create sustainability for the solar industry in our state for years to come, while helping to protect and increase opportunities for Floridians to install solar on their homes and businesses. (Click here for the “Friends of FlaSEIA” membership application.)
Contact your elected officials to tell them that it’s time we get serious about clean energy and the climate crisis, and encourage them to extend the solar ITC while you’re at it!
• Find your Representative
• Find your Senators
By speaking up and reaching out, perhaps we can reinvigorate the solar ITC and ensure it continues well into the future!