How to claim YOUR Federal Tax Credit?

Federal Tax Credit

You got solar installed, cool! But how to get the ITC?

Before we discuss how to claim the Investment Tax Credit (ITC), let us understand what is this credit. ITC is a credit amounting to 26% of the total cost of installing a solar panel system for 2020.

To be eligible for ITC, you must own the solar power system. Since this is a credit, you cannot get more than what you owe. For example, if you have your solar system installed for $20,000, you will get a 26% ITC in the amount of $5,200 which you can use to pay for your tax. Let’s say you owe $5,000 on federal tax, you can use the $5,000 to pay for your tax, and the $200 will roll over next year.

**Please note that here in Credence Energy, we are Solar experts. We strongly suggest you reach out to your tax adviser for more details.

Now, claiming ITC is easy. All you need to do is to include the IRS Form 1040 on your completed IRS Form 5695. Please refer for the below for the headers of forms we need to complete.

IRS Form 1040

IRS Form 1040

IRS Form 5695

IRS Form 5695

Please be advised that ITC won’t available forever. The ITC started to decline in 2019. This year, the ITC went down to 26% from 30% last year, and will not be available for residential customers by 2022.

Take advantage it today, start shopping solar on Credence today!

Source: https://news.energysage.com/how-do-i-claim-the-solar-tax-credit/