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– 26% Federal Tax Credit expires Dec. 31, 2022. Average of ~$5000 per Residence.
– Net Metering, aka Bill credit from the electric utility. No expiration date.
– No sales tax.
– Increased home value. Also, property tax assessment exempt.
– Associated electrical upgrades, e.g. batteries, also qualify for the 26% Federal Tax Credit.
– 26% Federal Tax Credit. Average value ~$5000 per Residence.
– Free power, aka Bill credit from the electric utility. No expiration date.
– No sales tax.
– Increased home value. More good news: Property tax assessment exempt.
– Associated electrical upgrades also qualify for the 26% Federal Tax Credit.
Add this home improvement and in the long run, save money and add value.
Applicable Solar Incentives:
26% of the total solar invoice is equal to the Tax Credit. For example, a $20,000 solar install would be a $4400 Tax Credit.
Your Residential Rental property is classified as a Business, or income-generating. The 26% becomes a Line Item Credit on your tax liability. This is the same percentage amount as the Solar Tax Credit that residential homeowners enjoy. The IRS wants you to file the Tax Credit differently but the total credit percentage is the same.
Additional Cost Recovery:
If your rental property is a qualified business then it’s likely you can depreciate, or “write off” your investment in Solar. There are limits on how much credit can be taken in a year. I can provide all of paperwork needed to pursue this. Let’s be sure and consult with your accountant first, for instruction and advice regarding this possibility. See #1 below, IRC Section 48 – Energy Credit, MACRS and Accelerated Depreciation Schedule.
References:
The Palmetto State is a blooming solar market. 🌼
Financial incentives have been a game changer. Many South Carolinians with solar installations get a combined state and federal tax forfeiture of at least 51%1 of the total cost of the purchase of a solar system.
There were 1,160 installations in 2016, 18,000 in 2019 and a forecast of 40,000 before 20242.
Solar at the beach! Ocean adjacent systems may use system components that are more resistant to saline conditions.
But also…Fresh rain cleans your panels!
South Carolina has huge solar potential but has opponents. Can you guess who doesn’t want competition in the energy marketplace?
Recently, a collective of solar-friendly entities was able to successfully lobby on behalf of the state’s utility customers. State Regulators rejected the latest appeal of the private utility companies who want to continue their monopoly on power delivery.
For example Dominion Energy’s attempt to attach financial penalties to their customers that adopted solar was officially and significantly delayed in May 20213.
Sources:
The 2019 State Legislature passed 2 new laws related to Solar. The bills promoted renewables in Washington State and sought to create greater confidence in interactions between multiple entities. Adopting solar now has its advantages, however if you must wait, a new Sales tax exemption will sweeten a solar contract drafted in 45 days or so.
The Solar Fairness Act pertains principally to Net Metering. Get credit for all the electricity you generate. Some utilities in our state had exceeded the legal threshold and therefore were under no obligation to grant credits to new participants . Now we can all interact with greater confidence. The existing state law threshold was very low. This new legislation raised it from .5% to 4% (or June 30, 2029 – whichever comes first). Here is the Solar Installer of WA’s bill digest. Way to go solar citizen lobbyists!
100% Clean Electricity Act. This ambitious 100% clean electricity mandate is a source of celebration for Governor Inslee and progressives. The framework propels a grid that uses clean renewable power. Within this law we have now established a Sales Tax exemption and a Remittance structure for various sizes of installations. See the savings on your solar contracts and invoices for the next decade. (Project must be completed by Dec. 31, 2029)
Please refer to this Solar Installer of WA recap for more details on these new laws.
Solar at work!