Solar System Installation: Things You Should Know About The Federal Solar Tax Credit

At this point, the sun has gifted us the opportunity to convert its light into energy. In recent years, the number of homes depending on Solar Layton, Utah has been increasing as the cost of channelizing the sun’s energy by installing solar panels has reduced by 70%!

Since paying for a solar panel system is expensive, the Federal government offers some tax credits to finance your solar system. Keeping reading to learn what to expect and how to get the Federal solar tax credit when you want to make a switch to solar –

What Is the Federal Tax Credit?

The Federal government gives a tax credit upon installing solar panels and it reduces the amount of income tax he would owe. The tax credit is a dollar-for-dollar reduction.

If you install the Solar System Layton and claim a tax credit of $1,000, you will get the benefit of exactly $1,000 deduction while paying your income tax. When your total income tax amount is $2,000 but you claim a $4,000 earned income credit, you will get a refund of $2,000 from the government.

Who is Eligible for the Solar Tax Credit?

People who can meet the following requirements are eligible to meet the tax credit –

·         Your solar photovoltaic (PV) system must be installed between January 2006, and December 2023.

·         The solar PV system must be installed in your primary or secondary residence in the United States.

·         You must purchase the solar system via financing or cash.

·         Since the credit counts towards the original installation, you need to invest in a PV system that is new or being used for the first time.

Expenses Covered

Expenses associated with installing the solar panel system that you can claim for the tax credit include –

·         Cost of solar PV panels

·         Everything from onsite preparation to installation cost to developer fees that are required to be paid to your Solar Contractor Layton

·         Energy storage devices

·         Inverters, wiring, and mounting equipment

·         Sales taxes

Claiming the Tax Credit

In order to enjoy the solar tax credit, you need to fill up the IRS Form 5695 and submit it with your federal tax return (Form 1040 or Form 1040NR). You may consult with a tax professional to know more about eligibility and all necessary steps.

Make sure you choose a trustworthy and reputable Solar Company Layton like Second Sun Solar that can offer high-quality service and guidance for Federal and state tax credits.