The ITC
(Investment Tax Credit)
The solar Investment Tax Credit (ITC) is one of the most important federal policy mechanisms to support the growth of solar energy in the United States.
What?
The Solar ITC provides a tax credit equal to 30% of the total cost of a solar energy system, including installation, equipment, and labor.
This credit can significantly reduce the upfront costs of installing a solar energy system, is available to both residential and commercial property owners and can be used for systems that are installed through the end of 2032.
Several ten percent “adder” credits are available, including:
Meeting wage and apprenticeship requirements
Utilizing domestic content
Installing in economically challenged areas
Twenty percent "adder" credits are available for multi-family low-income housing.
Who?
The ITC is available to individuals and businesses of all sizes who install solar energy systems on their properties. For example, a small business owner who installs a 10 kW solar energy system on the roof of their business is eligible for the credit, as is a large corporation that installs a 1 MW system on the roof of their headquarters.
The ITC is designed to make solar energy more accessible and affordable to all property owners, regardless of their size or industry.
*Note*
The credit can only be claimed on the original installation of the solar equipment. For instance, if you bought a house that came with a solar panel system already installed, you would not be eligible for the credit.
When?
The 30 percent tax credit will be available until 2033!
The 2022 extension of the ITC has provided market certainty for companies to develop long-term investments in solar as the US makes its transition to renewable energy.
Where?
The ITC is available to all property owners throughout the United States who meet the other eligibility requirements and install solar energy systems on a property they own. From single-family homes and small businesses to large corporations and government entities, this credit is expansive and accessible to property owners of all sizes and industries.
Why?
The ITC was created to incentivize the adoption of solar energy systems by reducing the cost of installation. By offering this tax credit, the government hopes to encourage the growth of renewable energy and reduce dependence on fossil fuels.
The ITC has been successful in achieving this goal, with the number of solar installations in the United States increasing significantly since the credit was first introduced in 2005. Additionally, the ITC helps support the growth of the solar industry and the creation of jobs in the renewable energy sector.