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Federal solar tax credit extended at 26% for two additional years!

Extended renewable energy tax credits have been included in the $1.4 trillion federal spending package alongside a $900 billion COVID-19 virus relief spending bill. The solar investment tax credit (ITC), which was scheduled to drop from 26% to 22% in 2021, will stay at 26% for two more years. The wind industry also received a limited extension of its production tax credit.


As an example, on a solar system that costs $10,000 to install, you would receive $2,600 as a credit on your gross income tax, so the net cost would only be $7,400.


This means that solar projects in all market segments — residential, commercial, industrial, utility-scale — that begin construction in 2021 and 2022 will still be able to receive a tax credit at 26%. All markets will drop to a 22% tax credit in 2023, and the residential market will drop to 0% while the commercial and utility markets will sit at a permanent 10% credit beginning in 2024.


You can view the language updates for the commercial/utility market beginning on pg. 2439 and the residential solar market beginning on pg. 2448 here.



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26% FEDERAL SOLAR TAX CREDIT and

the ADDITIONAL 10% NEW MEXICO SOLAR TAX CREDIT!

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