Solar Tax Credits.
Solar tax credit amounts
Installing renewable energy equipment in your home can qualify you for a credit of up to 30% of your total cost. The percentage you can claim depends on when you installed the equipment.
30% for equipment placed in service between 2017 and 2019
26% for equipment placed in service between 2020 and 2022
22% for equipment placed in service in 2023
As a credit, you take the amount directly off your tax payment, rather than as a deduction of your taxable income.
As tax credits fall, people are asking, is this the end of solar?
NO. The price of solar equipment is falling in price and rising in efficiency. The pay back is actually getting better.
You can also put solar on your vacation home but not your rental property.
You can't claim the residential solar credit for installing solar power at rental properties you own. But you can claim it if you also live in the house for part of the year and use it as a rental when you're away.
You'll have to reduce the credit for a vacation home, rental or otherwise, to reflect the time you're not there.
If you live there for three months a year, for instance, you can only claim 25% of the credit. If the system cost $10,000, the 26% credit would be $2,600, and you could claim 25% of that, or $650.
$10,000 system cost x 0.26 (26% credit) = $2,600 credit amount
$2,600 credit amount x 0.25 (25% of the year) = $650 credit amount