Friday, June 13, 2014

Tax Credit for Installing Solar Panel

As summer will be at it peaks soon all of us will be concerned about the electricity bills , installing solar panel can help us reduce the bills IRS expanded federal tax credit on Solar System installed between Jan. 1, 2009, and Dec. 31, 2016, system installed between these periods are eligible for a tax credit equal to 30% of the cost. To qualify, the system must supply electricity to a residence and meet local building codes.

That means a 5.2 kilowatt system that costs $44,200 would, in theory, earn a federal tax credit of $13,260. (This is a simplified example. Consult a tax adviser before you make final decision.)

The tax break can be applied to a solar-panel system installed at your primary residence or second home. Take the credit for the tax year the system becomes operational. Use IRS Form 5695. The credit can’t exceed the total amount owed in federal taxes for that year, but it can carry over to future years. Save receipts and certification statements.
 
If you are planning to install solar panel to reduce electricity bills then doing so before
Dec 31st 2016 will make you eligible for the 30 % credit .  


 

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