A Solar Energy Tax credit is a nonrefundable credit. Solar PV systems installed in 2020 and 2021 are eligible for a 26% tax credit. In August 2022, Congress passed an extension of the ITC, raising it to 30% for the installation of which was between 2022-2032. (Systems installed on or before December 31, 2019 were also eligible for a 30% tax credit.) It will decrease to 26% for systems installed in 2033 and to 22% for systems installed in 2034. The tax credit expires starting in 2035 unless Congress renews it.
Note: To claim the Solar Energy Federal Tax credit, you need to complete and attach IRS Form 5695 to your federal tax return.
You can enter them like this:
- Open or continue your return, if you don't already have it open.
- Select the Deductions & Credits tab.
- Find the Your Home section.
- Select the Start/Revisit button for Home Energy Credits.
- On the Energy-Saving Home Improvements screen, answer Yes and Continue. Follow the instructions on the next screens.
- The first part of the interview covers improvements like doors, windows, furnace, air conditioning, and heat pumps. If you're looking for other improvements like solar, geothermal, wind, and fuel cell, just keep going—we'll ask you about these soon.
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