With the increase in green technology and awareness about climate change, it is no wonder the general enthusiasm for solar power in homes and businesses is on the rise. In fact, according to figures from Solar Energy Industries Association (SEIA®), solar energy has ranked either first or second in energy capacity added to the U.S. for every year since 2013. A big push for solar energy comes from the savings on the environmental impact and the savings on energy bills. Growth can also be attributed to new solar array owners taking advantage of the Solar Investment Tax Credit (SITC).
In 2020, the Solar Investment Tax Credit (SITC) offered by the Federal Government is 26%. Keep reading to learn more about the solar investment tax credit.
What is the Solar Investment Tax Credit (SITC)?
The SITC is an important policy from the federal government that has helped solar energy expand in homes and businesses across the U.S. It provided 30% in 2019 tax credit for new solar systems installed for clients on their residential commercial, and other set-ups. The 2020 credit allows people to offset 26% of their solar installation from their federal taxes, if they qualify.
This benefit helps homeowners make the shift toward solar power. The credit also helps businesses make an investment to drive competition and technology forward so their customers can get the best service and products possible.
The Scale-Back Plan for the Solar Investment Tax Credit
As you can imagine, there has been debate for and against the SITC. Since legislation passed through Congress in 2015, the credit has been available for business and home owners through 2021. The tax credit is scheduled to scale back until 2022, however members of congress are debating extending it beyond 2022. If you qualify, the plan is as follows:
- 2020: New solar power systems for residential and commercial owners can apply to deduct 26% of the installation cost
- 2021: New solar power systems for residential and commercial owners can apply to deduct 22% of the installation cost
- 2022 and in the future: New solar power systems for commercial owners can deduct 10% of the installation cost - NO federal tax credit for residential customers
- As with all tax issues, ensure you consult your tax professional to see if you qualify
A Strong Outlook for Solar Energy in Michigan
In addition to a growing number of commercial and residential customers going solar, the future of solar power in Michigan looks bright! According to the U.S. News, Michigan’s state government will invest in solar power, too. Under Governor Whitmer’s program called the “MI Power Grid,” residents, businesses, and utility companies will continue to be able to invest in clean, reliable energy.
Learn more about the Solar Tax Credit
A great way you can gain the benefits of solar energy and take advantage of the Solar Tax Credit is by working with a professional, local installation company such as Michigan Solar Solutions. We have been in business for over 13 years, providing our customers with affordable options to reduce their environmental impact while saving money on their energy costs.
Contact the closest Michigan Solar Solution location to you to hear more about your solar options.