The federal solar tax credit (ITC) is an attractive program designed to incentivize homeowners to transition to greener and energy-efficient technologies. Solar power, as a renewable source of energy, qualifies for this tax credit. And it works!
Over the past decade, solar adoption has shot through the roof across the US, including in Bethlehem, thanks to ITC.
To protect Bethlehem homeowners from unscrupulous solar companies, we’ve compiled a list of items not eligible for claims under the federal solar tax credit.
- Energy-efficient Lighting
Trading your inefficient lighting like fluorescent bulbs in favor of energy-efficient LED lighting reduces your home’s power consumption, and, therefore, the size of your solar system. So, your solar company will recommend this to you. But that doesn’t mean it qualifies for solar tax credit.
- Insulation and Sealing
Once again, it’s part of the preparation to make your home more energy-efficient by preventing the loss of heat during winters and the loss of cool air during summers. However, it’s not a core part of your solar installation.
- HVAC Upgrade
You probably see a pattern here. No matter your investment in making your home more energy-efficient, it does not qualify for the solar tax credit. But that shouldn’t stop you from doing it. These improvements can bring you tremendous cost savings over the years.
If your solar system covers more than 50% of your roof space, then a part of your reroofing expense “could” be eligible for a solar tax credit. For most households, that’s an unlikely scenario. To know whether your reroofing expense is eligible for a solar tax credit, speak to your accountant.
- Previously Installed Solar Systems
The solar tax credit is available for first-time installations only. If you’re buying a PV system from another homeowner, or a commercial establishment that installed and used the system, then your investment would not qualify for the solar tax credit.
Be mindful of solar companies encouraging you to bundle ancillary expenses with your solar installation to claim the federal tax credit. It can land you in trouble.