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State tax filing
I've been doing solar as a career since 1998 and this has been a constant problem.
My two cents:
1) "Qualified solar electric property costs. Qualified solar
electric property costs are costs for property that uses solar
energy to generate electricity for use in your home located in the
United States. No costs relating to a solar panel or other
property installed as a roof (or portion thereof) will fail to qualify
solely because the property constitutes a structural component
of the structure on which it is installed. The home doesn't have to
be your main home."
See my explanation of the tax code language below. This is describing what "solar electric property" costs qualify. They are referring to roof tiles/shingles that ARE the roof in addition to the solar electric property. The 2nd sentence here is NOT referring to roofs, or the portion of the roof underneath panels, they are referring to the portion of the roof that is made up of solar roofing shingles, which are also a roofing structural component.
2) As someone else already said, just because someone successfully claimed the tax credit for a wrong amount, and didn't get audited and caught, doesn't at all mean they were correct. There is literally no proof of purchase or receipts or contracts or invoices that you are required to submit with the IRS form in order to prove how much you spent and what it was for. It is a very easy tax credit form to get away with anything. So, many people do.
3) By the logic that "the roof supports the panels, therefore they must qualify," then your entire house qualifies, too, right? Can't have a roof without a house. So heck, build a mansion and then put solar on it and claim 30% off. It's ridiculous, and almost 100% of the people arguing for using the tax credit for paying for a new roof are the ones wanting that extra money back and are doing whatever they can to rationalize it (or it's a solar salesperson wanting your sale). It's a selfish bias that is not based on facts. It's based on loose uninformed interpretation, and a want for money.
4) Just because one CPA interprets it to mean roofing costs are covered, does not mean that is correct. That just means they're willing to take on the liability of an audit. How many CPAs have allowed re-roofing to be included and then been audited? Tell me their stories, not the ones that haven't been caught.
5) Here is a link to the actual tax code itself, which is the end-all be-all on the subject:
What you'll notice first is:
"§ 25D. Residential energy efficient property
(a) Allowance of credit
In the case of an individual, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to the sum of—
(1) 30 percent of the qualified solar electric property expenditures made by the taxpayer
during such year,"
So you get 30% of the "solar electric property expenditures." Roofing material is NOT solar electric property. Unless it is a solar shingle/tile.
Then next there's this:
"(d) Definitions
For purposes of this section—
(2) Qualified solar electric property expenditure
The term ‘‘qualified solar electric property expenditure’’ means an expenditure for property which uses solar energy to generate electricity for use in a dwelling unit located in the United States and used as a residence by the taxpayer."
A solar panel is obviously "property which uses solar energy to generate electricity." Roofing material is obviously not. Unless it is a solar shingle/tile.
Next is:
"(e) Special rules
For purposes of this section—
(1) Labor costs
Expenditures for labor costs properly allocable to the onsite preparation, assembly, or original installation of the property described in subsection (d) and for piping or wiring to interconnect such property to the dwelling unit shall be taken into account for purposes of this section.
(2) Solar panels
No expenditure relating to a solar panel or other property installed as a roof (or portion
thereof) shall fail to be treated as property described in paragraph (1) or (2) of subsection (d)
solely because it constitutes a structural component of the structure on which it is installed"
So here they clarify that labor costs can be included, as long as they are for the labor to install "property which uses solar energy to generate electricity," which is not a roof. Oh, and the labor to install piping and wiring is specifically called out. THERE IS NOTHING RELATED TO ROOFING LABOR OR COSTS.
The last part, called out as (2) SOLAR PANELS is describing...you guessed it...SOLAR PANELS. Not roofing. That's the section header: Solar Panels, which are qualified solar electric property because they use solar energy to generate electricity. It's all been previously defined here. It's referring to solar panel property that is installed as a roof (or a portion of a roof)...aka SOLAR SHINGLES.
Bottom line: there is absolutely NOTHING in the tax code, or the tax law, or the tax forms, or the tax form instructions, that are intended to explicitly allow for roofing costs, which are not solar electric property, to be included.
If anyone says otherwise, they are either A) someone buying solar who needs to re-roof and wants to rationalize getting more money, B) someone selling solar who wants money from the solar buyer that needs to re-roof, or C) a tax professional who is either not doing their due diligence, not paying attention, or doesn't care and will take the risk of no audit.
Claim the costs of a re-roof at your own risk. It's playing the odds of audit. And just because someone didn't get caught, doesn't mean it's right and that you won't get caught. That's the way life works, we all know that, right? I mean, people do illegal stuff all the time, accidentally or on purpose, and never get caught. And if that's what you base your questionable tax filings on, then why even bother coming here and asking questions?
