30% Tax Credit For Solar PV To Start Sunsetting at End of 2019
Section 48 of the Internal Revenue Code currently includes a 30% ITC for solar PV systems, fuel cells, small wind and some other technologies. The ITC allows those who install clean energy assets to subtract 30% of the project(s) value from federal income taxes owed. This 30% ITC significantly raises the economic value of renewable and clean energy projects -- both those pursued through capital purchase and those financed through leases, power purchase agreements, shared savings agreements, etc.
The ITC for these technologies will begin sunsetting at the end of 2019. Step downs accelerate each year through 2022, with the pace varying by technology.
To secure the Solar Investment Tax Credit (ITC) for a given year, you must "begin construction," which the IRS has defined as either beginning physical work of a significant nature or incurring at least 5% of the total cost of the project. (There are some additional progress requirements.) This means that by taking quick and strategic action in 2019 you can still collect the full 30% of the current ITC.
n addition to the ITC, there is a raft of other incentives available from utilities (ConEdison, PSE&G, Eversource) and state agencies, like NYSERDA. Please feel free to drop us a line if you'd like to learn how you can leverage these lucrative financial opportunities.