Need a Big Tax Deduction for 2017?
All Solar Power Systems Completed by Dec. 31 Receive 30% of their Value as a Tax Credit
For some taxpayers, the holidays get missed for the stress of the coming tax season. With less than two months to go until its start, your time is running out to lower the amount of taxes you will owe and start lowering your electricity bills at the same time.
You may not have realized that you will save thousands on taxes when you invest in solar panels for your home or business. A renewable energy investment before the end of the year may be the New Year’s resolution you need to make early to eliminate tax debt and stress. By taking advantage of both the national and state tax incentives, many taxpayers are able to essentially buy a year or two, sometimes even more, of NO TAXES!
Navigating governmental-speak and changes in renewable energy policies as well as the tax credits themselves can be cumbersome. At Coastal Solar, we walk you through it.
A Look Inside Federal Renewable Energy Policies
There have been many renewable energy policies passed by state and federal government over the past decade. Some of the important ones include:
The American Recovery and Reinvestments Act of 2009
The Consolidated Appropriations Act of 2015
These initiatives and incentives have been passed, repealed, amended and increased to help Americans find more economical and eco-friendly ways to power their lives. This has been done at both the federal and local level for many U.S. states. In some states like Oregon, there are even mandates in place to replace electricity generation sources with renewable energy sources by 50% in the coming years.
The states that have their own renewable energy policies and tax credits in place offer their residents and business owners an additional average of 20% in tax credits. That equates to a 50% tax break during the year they go solar. In South Carolina, for example, you can save 50% on your state taxes for up to 10 years.
While not all states offer tax benefits, every property owner in the U.S. can still receive the federal tax credit and make their tax bill pay for their solar project.
Renewable Energy Tax Credit as It Stands For Solar Conversions
The federal policies translate into a tax deduction for home and business owners. For solar agreements made before December 31, a taxpayer receives a credit of 30 percent of their expenditures for solar power systems against the taxes they owe for that year.
The credit for expenditures made for solar electric systems and solar water heaters is not limited and can be carried over if it exceeds the taxes you owe next year. This means that if your credits are greater than the taxes you owe, the credits roll over to the next year’s taxes. This can result in a taxpayer paying no taxes for multiple years until the credit is used up.
If you install a $20,000 solar power system by December 31, you can apply up to $6000 against your tax bill. If you don’t owe $6000 in taxes, you can apply the excess to next year’s taxes. Uncle Sam wants you to invest in solar, and is willing to help you pay for your project!
Right now, the credit for solar electric property and solar water heating property is extended for property placed in service through December 31, 2021.
Learn More About the IRS Deduction for Solar Power Installs.
Coastal Solar Can Help With Your 2017 Taxes!
If you need a tax deduction for this fiscal year, Coastal Solar can help! We will sit down with you and provide you with a full breakdown of your costs and credits. We’ll even help you make the deductions for your 2017 taxes. Signing a solar agreement before the end of the year can eliminate your extra tax burden this year. Don’t forget, once you go solar, you will also save up to 70% on electricity in 2018.
If you need to buy yourself a year or more of tax deductions, contact us today. We can help!