The federal government currently offers a 26% solar tax credit. It is important to note that as a renewable energy credit, and not a deduction, you will receive the 26% back on your federal taxes (until 2021). Additionally, commercial customers can take a 5-year accelerated tax depreciation on their system cost.
Customers who lease solar panel systems cannot claim the federal tax credit outright, but the benefits are passed to them from the system’s owner or installer, lowering their monthly payment substantially.
Although the state of California does not offer rebates or tax credits, there are many local cities and counties that offer homeowners in their communities solar rebates or renewable energy credits.
For Northern California residential and commercial customers, your utility company will issue energy credits for excess power your system produces through its net-metering program.
The IRS Form 5695 for Residential Energy Credits 2019 is the current form available for those who are looking to claim energy credits on their current income taxes. You are eligible to apply for this credit if you purchased and installed a solar power system during the past year.
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