Please remember that we are not tax professionals and do not give tax advice. This information is only a general outline of what steps/forms to use when claiming the federal solar tax credit. Please consult a tax consultant before filing.

Tax Benefits Of Going Solar

The federal government is offering a 30% tax credit to reduce the costs of adding rooftop solar panels. With the average home energy system costing upwards of $25,000, this single deduction can offer homeowners huge savings!

Solar Tax Credit Amounts

Adding a rooftop solar system to your home allows you to qualify for a credit of up to 30% of your total cost, including:

• Solar PV panels or PV cells

• Solar-powered systems that generate electricity or heat water

• Contractor labor costs 

• Permitting fees

• Installation costs

• Energy storage devices (batteries, generators) charged by solar panels

Tax credits are different from tax deductions. A credit allows you to take the amount directly off your tax payment vs. a deduction which reduces your overall taxable income. 

The 30% solar tax credit amount is only available through 2033. After that, the amount will be reduced to 26%.

Solar Tax Credit Limitations

• The tax credit can only be claimed on the "original installation" once

• Homeowners cannot** claim the solar tax credit multiple times (see below)

• Credit and savings do not apply to leads solar systems or fees associated with community solar farms 

• You can't claim the solar tax credit on rental properties you don't live in

• If you live part-time in a rental property you own (say three months out of the year), you can claim the tax credit for the amount of time you were in the home

• **If you own multiple homes, you may be able to claim the tax credit for each property - discuss this with a tax professional

Filing Requirements 

To claim the solar tax credit, you must file Form 5695 with your annual tax return. Access the form and get instructions on how to complete the form here.  

One of the biggest questions we get from homeowners is about total tax liability and what happens if you have a credit larger than what you owe. If you end up with a bigger credit than you have income tax due — ex.a $3,000 credit on a $2,500 tax bill —then you can't use the credit to get money back from the IRS. Instead, you are allowed to carry the credit over to the following tax year.

Solar Tax Credit FAQs

Get A Free Solar Quote In OKC

Curious about how much you can save with the federal solar tax credit? Schedule a free solar quote and let our experts analyze your home and energy needs to calculate your costs and savings. Use the form below to get started!