New Legislation Increases Solar Tax Credit
Exciting News: Federal Solar Tax Credit Returns to 30% and Extends for Ten Years under the Inflation Reduction Act!
In a significant development for Maine's environmentally conscious homeowners and businesses, Congress has recently passed the Inflation Reduction Act, a comprehensive climate and inflation reduction bill. This act brings fantastic news for those considering the installation of solar electric systems, offering substantial benefits. Let's dive into the key highlights of this groundbreaking legislation:
Solar Investment Tax Credit Returns to 30%: The Solar Tax Credit has played a pivotal role in making solar power accessible and affordable to homeowners and businesses. With the Inflation Reduction Act, this tax credit is being reinstated to an impressive 30%. Previously, it was set to decrease from 26% in 2022 to 22% in 2023, eventually expiring in 2024.
Solar Tax Credit Extended for 10 Years: Along with the increase to 30%, the tax credit has been extended for an entire decade. Under this new legislation, the 30% federal tax credit will continue for ten years before gradually decreasing to 26% in 2033 and 22% in 2034. As it stands now, the tax credit is slated to last until 2035.
Retroactive Credit for Systems Installed in 2022: If you installed your solar electric system since the beginning of 2022, you're in luck! The newly enacted 30% tax credit will be retroactively applied to your system.
30% Credit for Battery Backup Systems: Starting in 2022, batteries integrated with a solar electric system are eligible for the 30% tax credit. This is excellent news for homeowners seeking to store surplus solar energy for use during the night or during power outages. Standalone battery systems, even those without solar electric systems, will also qualify for the 30% tax credit beginning in 2023.
Homeowners can now invest in battery systems like the Tesla Powerwall, which not only allow them to store excess solar energy but also provide backup power during blackouts and outages. With the growing concern of extreme weather events threatening grid reliability, battery systems offer a valuable solution.
How the Federal Solar Tax Credit Works: Solar electric systems qualify for a 30% Federal Tax Credit, which effectively reduces your federal tax liability. This credit is applied when you file your taxes. When you purchase a solar electric system at its full price, you earn a 30% tax credit, which can be used to offset your tax liability during the filing process. For detailed information on the Solar Tax Credit, consult a qualified tax professional.
Going Solar in 2023: If you're contemplating going solar in 2023, the time to act is now! An increasing number of Maine homeowners are choosing solar electric systems to lock in their electricity costs and realize substantial returns on their investment. With more homeowners transitioning from fossil fuels to energy-efficient solutions like electric heat pumps and heat pump hot water heaters, investing in solar electric systems has become an effective strategy to combat rising energy costs. Consequently, Maine Solar Pro has witnessed a surge in demand for solar solutions in recent years, and we anticipate even higher demand in the upcoming year as utility prices continue to climb. Don't miss out on this opportunity to secure your energy future.
