If installing solar power panels for your residence was a consideration for 2020 or 2021, now is the time to act.
The Federal Solar Investment Tax Credit has been one of the larger tax credits taxpayers have benefitted from the past few years. Prior to 2020, taxpayers were allowed a tax credit on their tax return equal to 30% of the total installation and product costs of solar panels on their residence. For the 2020 tax year that credit is now 26% of such costs. And in 2021 the tax credit will drop again to 22% of the total cost.
Completion date is the key, not the date the project begins. Taxpayers claim this tax credit in the year the project is completed and placed in service in your home. Unless the credit is extended by the government, 2021 will be the final year individual taxpayers can claim this tax credit. Thus, if you have been thinking about adding solar to your residence – now is the time to plan to be sure to have the job completed by the end of 2021, before this significant tax credit disappears.