The Solar Power Investment Tax Credit (ITC)
The federal solar power Investment Tax Credit (ITC) offers a percentage deduction from the cost of installing a solar energy system on your federal taxes. Applicable to both residential and commercial systems, this credit has no value cap, providing substantial savings.
Understanding and predicting these power spikes can be challenging, causing frustration for most commercial customers trying to decipher the driving factors behind their peak demand usage. These spikes may translate into substantial monthly costs, exerting a significantly affecting your bottom line.
The Inflation Reduction Act Restores the Tax Credit
The Inflation Reduction Act, signed into law in August 2022, revitalizes the 30% solar and storage tax credit, now termed the Residential Clean Energy Credit (RCEC). This tax credit applies to Solar, Battery Backup systems, Solar and Battery Electrical upgrades, and Electric Main Panel/Service upgrades.
Deduction Timing
As each tax year draws to a close, there is a surge in solar purchases to take advantage of the tax credit, leading to high installation volumes. This rush may pose a risk to your current year's tax credit. To navigate the year-end crunch, we recommend prompt action. Ensure a commitment from your installer regarding their capacity to complete construction by year-end to secure your tax credit.