If you’re thinking about adding a solar panel system to your home, you can take advantage of a federal tax credit that was recently extended as part of the most recent spending bill. The credit can be applied toward the purchase and installation of residential solar panels. Here’s how it works:
Homeowners who have their systems installed in 2021 and 2022 are eligible for the tax credit, which deducts 26% of the cost of installation and setting up a battery backup. Importantly, only those who own their new solar panel system are eligible for the tax credit. Simply let your tax preparer know that you’ve recently installed a solar power system, or if you do your own taxes, you’ll need to fill out tax form 5695. (Here’s a link to the form)
Additionally, if you’re thinking about waiting on an install, know that the credit drops down to 22% in 2023, and falls off to 0% in 2024. Although it could be extended again—the tax credit program has been extended several times since its inception in 2005—the deduction might not be as high as the 26% currently offered, so if you’re thinking of making the investment, now is the time.
The price of solar technology has dropped 45% over the last five years, and with the extension of the tax credit, there’s never been a better time to make the switch. Purelight Power is here to answer any questions you might have about the tax credit or to give you a free quote on residential solar installation. Give us a call today!