Solar Tax Credits Increased and Extended for 2023 and Beyond
The Residential Clean Energy Credit, also known as the Solar Investment Tax Credit, is a renewable energy incentive program that has offered tax deduction incentives since 2006 for homeowners who choose to switch to solar energy. Residential solar energy has rapidly grown and continues to become more widely available to homeowners and business owners, especially in Florida.??
The Solar Investment Tax Credit has recently been increased and extended for another 10 years, which is exciting for climate conscious consumers. The ITC raised the amount of credit you can apply towards your income tax, from 26% to now a total of 30% of the overall cost of solar equipment, and instead of decreasing next year as scheduled, it has been extended until 2032 before it will be reduced to 26% again in 2033, and then 22% in 2032.?
“The ITC allows homeowners and business owners who have purchased and installed solar photovoltaic (PV) energy generation systems in 2022 or will do so before 2033 to claim a federal tax credit equal to 30% of the overall cost of the system’s components,?installation?and associated fees during the year of installation. A tax credit is a one-for-one dollar amount reduction from income tax that you would have paid without the credit. If your solar PV system costs?$20,000?and you claim the ITC at 30%, you will owe?$6,000?less in income tax for the year, effectively lowering the system’s total cost to?$14,000. As the new law currently stands, if the amount of tax you owe for the year you become eligible is less than the credited amount, you can roll the difference over to the following year.”
This is great news because it means more savings for those who are ready to make the switch to solar. All Ecosun Homes are fitted with solar panels for efficient renewable energy and our homes undergo rigorous testing to meet Department of Energy standards, allowing our homeowners to take full advantage of this tax credit increase.?
“To be eligible for the Solar Tax Investment Credit, you will need to meet the following criteria. Consult your tax accountant to ensure your eligibility.
If you meet the eligibility requirements to receive the Solar Tax Credit, you’ll need to complete and include?Form 5695?with your federal tax return for the tax period in which the PV system is first installed and made operational.”
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In addition, the Solar Investment Tax Credit also allows you to receive deductions for up to 30% of the cost of other energy efficient features. Eligible items include heating, cooling, and water heating equipment, insulation materials, windows and exterior doors, and home energy audits, which can add up to around?$5,050 in additional tax credit. Ecosun Homes are built to include many of these features so that our homeowners can feel good about using clean energy while also taking advantage of the solar incentive program.
Switching to solar can provide many more benefits than just a tax credit. With modern technology, solar energy is overall less expensive and more efficient than ever. It makes a positive impact on the environment by reducing the use of nonrenewable energy sources as well as reducing your overall energy bill.?Ecosun Homes is dedicated to making a difference with our DOE certified Zero Energy Ready homes, thoughtfully designed to integrate the best green technology with premium smart home features.??
With Ecosun, the future is always bright.??
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