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Solar Incentives In California
What Is The Solar ITC Tax Credit?
For homeowners and businesses who decide to switch to solar energy, you can take advantage of the 26% ITC (investment tax credit) until the end of 2020. In 2021 the tax credit will be at 22%. This program was started in 2006 to help the growth of solar in the united state. The ITC is claimed against your tax liability. This allows you to apply the tax credit to your personal income taxes.
Residential ITC Schedule
2019 - 30% (expired)
2020 - 26%
2021 - 26%
2022 - 26%
2023 - 22%
2024 - 0%
Commercial ITC Schedule
2019 - 30% (expired)
2020 - 26%
2021 - 26%
2022 - 26%
2023 - 22%
2024 - 10%
Commercial Only - Modified Accelerated Cost-Recovery System (MACRS)
Businesses that install solar energy systems can claim the Modified Accelerated Cost-Recovery System (MACRS). This is a five-year depreciation schedule. Typically this adds between 25%-30% of your solar energy project being offset by a tax reduction. In 2017 the Tax Cuts and Jobs Act increased the bonus to 100% depreciation for solar systems installed before January 1st, 2023.
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