Federal Incentives
Residential Solar
Through the newly enacted Inflation Reduction Act, a federal income tax credit (ITC) of 30% of the cost of a qualified system is available for all residential solar projects through 2032.
The federal ITC is a dollar-for-dollar credit that reduces your federal income tax liability for the year the system is placed in service. If you can’t use all the credits in the first year, it can “roll over” for several years after.
In order to utilize the tax credit, you must have taxable income to apply toward it and are advised to consult with a tax professional to see how it applies to you in your situation.
Commercial Solar
Through the newly enacted Inflation Reduction Act, a federal income tax credit (ITC) of 30% of the cost of a qualified system is available for all residential solar projects through 2032.
The federal ITC is a dollar-for-dollar credit that reduces your federal income tax liability for the year the system is placed in service. If you can’t use all the credits in the first year, it can “roll over” for several years after.
In order to utilize the tax credit, you must have taxable income to apply toward it and are advised to consult with a tax professional to see how it applies to you in your situation.
Additional bonus tax credits of up to 70% are available if the project meets certain requirements as indicated in the table below:
Table 1: Investment and Production Tax Credit Amounts
*The ITC amount is a percentage of the total qualifying project cost basis. For projects >1MW AC, Domestic Content and Energy Community adders also assume labor requirements are met for full value.
Source: https://www.energy.gov/femp/overview-inflation-reduction-act-incentives-federal-decarbonization
Visit the DOE Solar Energy Technologies Office for additional information and resources on federal tax credits.
State & Utility Incentives
Some states and electric utilities offer additional incentives to help you with the cost of solar. A great resource for information on energy tax credits and other incentives is dsireusa.org.