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How Many Times Can You Claim Solar Tax Credit? Insights from a Michigan Solar Company

The solar industry is booming, and with it comes the opportunity to save money on energy costs and reduce your carbon footprint. One of the most significant incentives for going solar is the federal solar tax credit, also known as the Investment Tax Credit (ITC). But how many times can you claim this solar tax credit? This question is often asked by homeowners considering installing a solar panel system. As a leading Michigan solar company, we are here to shed light on this topic.


Understanding the Federal Solar Tax Credit


The federal solar tax credit was established to encourage homeowners and businesses to switch to renewable energy. It allows you to deduct 30% of the cost of installing a solar energy system from your federal taxes. This applies not only to residential properties but also commercial ones. With commercial applications, there is bonus depreciation available up to an additional 18%. The ITC applies to both photovoltaic (PV) and solar water-heating systems of any size, making it an attractive incentive for those considering going green. This credit also applies to maintenance needed for your install. This can include tree trimming to eliminate shaded areas or roof treatments like Roof Maxx that extend the life of your roof by up to 15 years.


How Many Times Can You Claim Solar Tax Credit?


The simple answer is that you can claim the federal solar tax credit as many times as you install a new solar power system on different properties. Each new installation comes with its own eligibility for the tax credit. However, there are some conditions.


Firstly, you must own your home or business property. If you're leasing or under a power purchase agreement (PPA), you're not eligible for the ITC.


Secondly, your new solar power system must be operational in the year you claim your credit. For example, if your system is installed and operational by December 31st, 2024, then you could claim your ITC when filing taxes in 2025.


Lastly, there's no double-dipping allowed. If two or more people jointly own a property where a new system is installed, they can't each claim the full credit. The tax credit must be shared proportionally according to their ownership stakes.


The Role of a Michigan Solar Company


As a leading Michigan solar company, we play a crucial role in helping homeowners and businesses understand and navigate the process of claiming the solar tax credit. We provide comprehensive services that include designing and installing solar power systems, assisting with paperwork for permits, and providing guidance on how to claim the ITC.


We ensure that our clients are well-informed about the financial benefits of going solar, including how to maximize their return on investment through the federal solar tax credit. Our team stays updated with any changes in federal or state policies regarding renewable energy incentives, ensuring our clients have accurate and timely information.


The Future of Solar Tax Credit


While the federal solar tax credit has been a significant driver for solar installations across the country, it's important to note that this incentive is set to decrease in the coming years. The 30% tax credit is available for systems installed through 2032. In 2033, it will drop to 26%, and then to 22% by 2034,


This decreasing schedule underscores the importance of acting sooner rather than later if you're considering going solar. By partnering with a reliable Michigan solar company like ours, you can ensure your system is installed promptly and professionally, allowing you to maximize your potential savings.


Conclusion


The federal solar tax credit offers substantial savings for those willing to invest in renewable energy. While you can claim this tax credit multiple times for different properties or installations, understanding its terms and conditions is crucial. As an experienced Michigan solar company, we are committed to helping our clients navigate these complexities while delivering high-quality solar solutions tailored to their specific needs.


We are Cardinal Power Systems, a Michigan solar company, and we would be honored to work with you towards building energy independence. Please do not hesitate to give us a call at (800) 936-5386 with any questions you may have.



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