Solar Technology Tax Credits Still Available for 2020 - Dec 2020 Money Contributed by : Mukesh Makker Add To My Favorite Share With Your Friends

Certain energy-efficient home improvements can cut your energy bills and save you money at tax time. While many of these tax credits expired at the end of 2016, tax credits for residential and non-business energy-efficient solar technologies do not expire until December 31, 2021. Here are some key facts that you should know about these tax credits:

RESIDENTIAL ENERGY EFFICIENT PROPERTY CREDIT

• This tax credit is 30 percent of the cost of alternative energy equipment installed on or in your home.


• Qualified equipment includes solar hot water heaters and solar electric equipment placed into service on or after January 1, 2006, and on or before December 31, 2021.


• There is no maximum credit for systems placed in service after 2008.


• The tax credit does not apply to solar water-heating property for swimming pools or hot tubs.


• If your credit is more than the tax you owe, you can carry forward the unused portion of this credit to next year's tax return.


• At least half the energy used to heat the dwelling's water must be from solar in order for the solar water-heating property expenditures to be eligible.


• Solar water-heating equipment must be certified for performance by the Solar Rating Certification Corporation (SRCC) or a comparable entity endorsed by the government of the state in which the property is installed.


• The home must be in the U.S. It does not have to be your main home.


• Use Form 5695, Residential Energy Credits, to claim the credit.

Equipment costs such as assembling or installing original systems, on-site labor costs, and costs related to wiring or piping solar technology systems are considered final when the installation is complete. For a new home, the placed-in-service date is the occupancy date.

The maximum allowable credit varies by the type of technology:

Solar-electric property

• 30% for systems placed in service by 12/31/2019


• 26% for systems placed in service after 12/31/2019 and before 01/01/2021


• 22% for systems placed in service after 12/31/2020 and before 01/01/2022

Solar water-heating property

• 30% for systems placed in service by 12/31/2019


• 26% for systems placed in service after 12/31/2019 and before 01/01/2021


• 22% for systems placed in service after 12/31/2020 and before 01/01/2022

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About Author
	Mr. Maker is a certified Public Accountant and serving the South Asian community since 1993.

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