Don't Miss Out on the 26% Solar Tax Credit!
Jul. 13, 2022
Have you been thinking about installing a solar energy system, but aren’t sure if you should go solar now or wait? Now is the perfect time to take the leap and schedule your solar panel installation!
The federal solar tax credit—one of the most lucrative solar incentives available—is in its final stages. The federal solar tax credit in 2022 is worth 26% of your total solar installation costs, but it will be reduced to just 22% in 2023. In 2024, the tax credit will be eliminated for homeowners and reduced to just 10% for commercial solar installation.
To make sure you get the 26% solar investment tax credit, contact Boston Solar to schedule your solar installation as soon as possible—to qualify for the 26% credit, your system must be fully installed and turned on by December 31, 2022.
What Is the Federal Solar Tax Credit?
The federal solar tax credit, formerly known as the Investment Tax Credit or ITC, is a solar incentive that was implemented by the federal government in 2005. It first took effect in 2006 and has been extended multiple times since its inception. The most recent extension was in December 2020.
While it’s possible that the ITC will be extended again, it is currently set to sunset for residential solar in 2024. Commercial solar installations will be eligible for a 10% ITC from 2024 on.
How Does the Federal Solar Tax Credit Work?
The ITC is a tax credit that allows you to reduce your federal tax liability by a percentage of your total solar panel and solar battery installation costs. You claim your incentive while filing your federal tax return:
- Keep track of your solar installation expenses and add up all costs (make sure you save your receipts).
- Fill out an IRS Form 5696 (for homeowners) or Form 3468 (for businesses).
- Add your credit information to your typical IRS Form 1040.
- If your credit is worth more than your federal tax liability, you can roll it over to the next year.
Almost all solar installations qualify for the solar tax credit. To be eligible:
- you must own your solar system (no leases or PPAs),
- own your property, and
- have taxable income.
Boston Solar can help you learn more about the ITC and determine whether you qualify. However, we are not tax professionals and we always recommend consulting with your tax advisor before making any decisions.
Start Your Solar Installation Now to Secure the 26% Solar Tax Credit
The solar panel federal tax credit in 2022 is the highest it will ever be again, unless we see another extension. This incentive makes it significantly easier to manage the upfront cost of a solar installation and is a great opportunity to go solar. With a solar energy system, you’ll be in control of your own energy production, reducing your electricity costs and protecting you against rising rates.
Boston Solar is a leading solar installer near you in Massachusetts. A proud partner of the Boston Red Sox, we’ve been empowering Massachusetts for more than 10 years and have helped more than 5,000 homeowners and businesses go solar. If you act fast, we can install your system before the federal solar tax credit drops down, so call us today to schedule a consultation!
Save 26% on your solar installation with the federal solar tax credit in 2022. Call 617-858-1645 or contact us to get started.