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The federal residential solar energy credit is a tax credit that can be claimed on federal income taxes for a percentage of the cost of a solar photovoltaic (PV) system. (Other types of renewable energy are also eligible for similar credits but are beyond the scope of this guidance.)

The system must be placed in service during the tax year and generate electricity for a home located in the United States. There is no bright-line test from the IRS on what constitutes “placed in service,” but the IRS has equated it with completed installation.

Government Tax Credits for Solar

In December 2020, Congress passed an extension of the ITC, which provides a 26% tax credit for systems installed in 2020-2022, and 22% for systems installed in 2023. (Systems installed before December 31, 2019 were eligible for a 30% tax credit.) The tax credit expires starting in 2024 unless Congress renews it.

There is no maximum amount that can be claimed.

For more information, visit: https://www.energy.gov/eere/solar/homeowners-guide-federal-tax-credit-solar-photovoltaics

 

For the Department of Energy’s guide for homeowners going solar, visit: https://www.energy.gov/eere/solar/homeowners-guide-going-solar