It’s no secret that going solar can save you money on energy bills, but did you know it can also save you money on taxes? At both the state and federal levels, there are tax exemptions and credits that can help you save big after switching to solar power.
It’s no secret that homeowners can save big on their bills with solar panels, but there are a few ways to save even bigger with solar in Arizona. If you’re thinking about choosing solar for your home, check out these incentives and credits to increase your savings.
The federal solar tax credit
If you're considering solar for your home, read up on the federal Solar Investment Tax credit (ITC). All homeowners qualify for this huge federal incentive, which can save you thousands of dollars on your solar installation investment.
The ITC lets home and business owners subtract 30 percent of the cost of installing their solar energy system from their federal taxes. The best part? There is no cap on the value of the credit.
According to a report based on EnergySage’s marketplace data, the average solar tax credit is about $9,000. Numbers like that make a big difference when you’re trying to decide how affordable going solar really is for your home.
The ITC tax credit has helped solar power explode in recent years, making it more affordable for homeowners and businesses across the country to go solar.
In 2015, Congress approved an extension for the ITC credit, allowing solar customers to claim a credit on their solar installations as long as they are operational by December 31, 2023. However, you can only receive the 30 percent credit if your solar energy system is installed by December 31, 2019. The credit will decrease in value for systems installed in 2020, and will continue to decrease until 2023 when the extension ends.
For more information on how to cash in on you solar tax credit, visit this step-by-step guide from Energy Sage.
State property tax exemptions
Arizona offers a property tax exemption for rooftop solar customers, and there is no cap on the amount of equipment you can claim on this exemption. To qualify for the exemption, you must provide documentation of your purchase and solar installation to your county assessor within six months of the installation.
Net metering credits
Arizona solar customers can also save big with net metering perks. When your solar energy system isn’t using energy, it feeds that extra power back into the grid. Your electricity company measures that unused energy and returns it to you in the form of a credit on your bill. These savings have an important catch, though. A pending APS rate case may cut these net metering credits for future solar customers. You must install your solar energy system before July 1, 2017 to take advantage of the current net metering rates! Don’t wait!
To learn more about the APS case and why it matters for the future of solar in our state, check out our latest rate case blog post.
For more incentives and loan programs, visit this solar savings resource.
Don’t miss out on these huge savings! Contact us today to find the best solar options for your home, and we’ll help you start on the path to solar savings.