Solar is the Future: 30% Federal Solar Tax Credits End In:
30% Federal Solar Tax Credits End In:
Is solar the future? Whether you’re watching the news, scrolling past an Instagram ad or talking to a friend: it’s hard not to recognize that solar power is a trend that keeps gaining momentum. In addition to its growing popularity, solar is becoming even more mainstream, with everyone from your neighbor to your uncle installing solar panels to help them save money and the planet. But is solar really the future?
To answer that, let’s actually take a step back. Solar power is actually a much older concept than we realize…
Do you know how long solar power has been around?
Since ancient times, civilizations have been harnessing the power of the Sun. In fact, Egyptians and the Greeks had to plan months, if not years in advance to make their homes habitable during the winter.
But, with their knowledge of the sun’s seasonal position in the sky, many homes were strategically built to capture as much of the sun’s heating rays as possible during the day so that they would stay relatively warm during the night.
So how long will solar be around in its modern-day formatting? Is it a fast fad? Will it fade in the future?
The answer is no. Solar is here to stay and being one of the first people on board will be extremely beneficial for you, and your wallet. (Not to mention the environmental benefits that come from utilizing the power of solar that only compound over time.)
As it stands now, the world only gets about 1% of its energy resources from solar; however, it is entirely feasible that in the next 30 years this percentage could skyrocket to as high as 27%.
But the biggest form of support for the future of solar comes from the Federal Tax credit that was approved by congress in 2015 that created a 5-year solar tax credit extension, which makes solar energy more affordable for all Americans.
What is the solar tax credit?
The federal solar tax credit, also known as the investment tax credit (ITC), allows you to deduct 30 percent of the cost of installing a solar energy system from your federal taxes. The ITC applies to both residential and commercial systems, and there is no cap on its value.
Want to know how to utilize this credit? This credit was actually established over 10 years ago, but the extensions provided are meant to make solar energy more affordable and easy to access for consumers. Here is what the extension looks like:
- 2016 – 2019: The tax credit remains at 30 percent of the cost of the system. This means that in 2019, you can still get a major discounted price for your solar panel system.
- 2020: Owners of new residential and commercial solar can deduct 26 percent of the cost of the system from their taxes.
- 2021: Owners of new residential and commercial solar can deduct 22 percent of the cost of the system from their taxes.
- 2022 onwards: Owners of new commercial solar energy systems can deduct 10 percent of the cost of the system from their taxes. There is no federal credit for residential solar energy systems
Additionally, in previous years, owners of new solar energy systems could not claim the tax credit unless their system was operational. Now, the legislation allows them to claim it as soon as the construction of the system is complete, as long as it is operational by December 31, 2023.
Do you want to take advantage of the Solar Tax credit? Now is the PERFECT time because Poulin Solar Pro is also running a Grand Slam Solar promotion giving you 20% off in addition to the 30%! Contact us today so you won’t miss this!