One incentive for implementing solar power is to harness the energy generated by the sun and put it to work generating electricity for your home or business. There’s nothing like CLEAN, RENEWABLE ENERGY! To see how much savings you can expect on your electric bill, check out the link to our residential and commercial systems.
Wilderness Trace Solar, Inc., has developed very good working relationships with many Kentucky utility providers to facilitate setting up your Net Metering Agreement for your “Grid-Tied” Solar Energy System. Net Metering means you can generate credit for energy you push back to the “grid”, reducing your electric bill! Contact your electric utility provider and ask them about Net Metering – and while you’re at it – get a copy of your energy usage for the last year!
“SHOW ME THE MONEY!”
Currently there is a 30% Federal Tax Credit available to residential home owners.
Here are the FAQ’s and more information for you:
INFO FOR FEDERAL INVESTMENT TAX CREDIT FOR SOLAR PV
What is a tax credit?
A tax credit is a dollar-for-dollar reduction in the amount of income tax you would otherwise owe. For example, claiming a $1,000 federal tax credit reduces your federal income taxes due by $1,000
What is the solar investment tax credit?
- The federal solar investment tax credit (ITC) is a tax credit that can be claimed on federal income taxes for 30% of the cost of a solar photovoltaic (PV) system.
- The system must be placed in service during the tax year and generate electricity for a home located in the U.S.A.
- There is no maximum amount that can be claimed
Am I eligible to claim the solar investment tax credit?
You might be eligible for this tax credit if you meet all of the following criteria:
- The 2022 Bill Signed this year is retroactive for systems installed this year.
- The solar PV system is located at a residential location in the U.S.A. (but not necessarily your primary residence).
- You own the solar PV system (either you purchased it with cash or through financing)
- The solar PV system is new or being used for the first time. The ITC can only be claimed on the original installation of the solar equipment.
What is the difference between a tax credit and a tax rebate?
It’s important to understand that this is a tax credit and not a rebate. Tax credits offset the balance of tax due to the government (therefore, if you owe no tax, there is nothing to offset and you can’t take advantage of it). Tax rebates are payable to the taxpayer even if they owe no tax. While most people qualify for the solar panel tax credit, there are some who do not. Anyone who does not owe federal income taxes will not be able to benefit from the solar tax credit. And, if you’re on a fixed income, retired, or only worked part of the year, you may not owe enough taxes to take full advantage of this solar tax credit.
If you do owe sufficient federal taxes the year that you finance or purchase your system, then the credit can be applied to pay off the taxes owed. If you already paid that taxes by withholding it from your paycheck, the federal government will apply the tax credit to a tax refund. This refund can be used to pay down the balance on a loan. It’s important to note that the tax credit be carried forward one year, which means that you can use any remainder from this year as a credit towards next year’s taxes.
FAQ Solar Energy Tax Credit
- WHAT IF THE SOLAR PANEL TAX CREDIT EXCEEDS MY TAX LIABILITY? WILL I GET A REFUND?
This is a nonrefundable tax credit, meaning you will not get a tax refund for the amount of the solar tax credit that exceeds your tax liability. However, you can carryover any unused amount of the solar tax credit to the next tax year.
- CAN I USE THE SOLAR PANEL TAX CREDIT AGAINST THE ALTERNATIVE MINIMUM TAX?
Yes. The tax credit can be used against either the federal income tax or the alternative minimum tax credit.
- HOW DO I CLAIM THE ITC?
After seeking professional tax advice and ensuring you are eligible for the ITC, you can fill out and attach IRS Form 5695 to your federal tax return (1040 or Form 1040NR).
•Internal Revenue Service, located at 1111 Constitution Avenue, N.W., Washington, DC 20224, and phone at (800) 829-1040.