For most solar projects, the federal government offers a 30% Solar Energy Tax Credit for property owners that install a PV system, whether on- or off-grid. The credit is usually equal to 30% of the post-rebate total installed cost. If the solar tax credit is more than you can use for the year of installation, any excess tax credit can be carried forward: residential carries forward until 2016, commercial carries forward 20 years. The average tax credit for a home PV system is around $5,000-$10,000, or more. Also available is an additional 30% tax credit for residential solar hot water systems.
Solar energy systems for businesses qualify for the 5-year Modified Accelerated Cost Recovery System (MACRS) depreciation deductions. Currently solar energy systems are classified as 5-year properties. Check with a qualified tax preparer or accountant for accurate advice. See also Section 168 of the Internal Revenue Code and IRS Form 4562.
The federal government currently offers businesses a tax credit equal to 30% of the pre-rebate cost of installing a solar system, but that tax credit can be waived in order to receive a one-time federal grant equal to the tax credit. Grants are only available for systems that have begun the installation before the end of 2011. Please call our Commercial Designer, Robin Harp, at (530) 432-3776 for further details on the 2011 federal solar grant.
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