Purchased solar for rental property and where do get my tax credit

[MinhT]

The solar energy tax credit is not available for rental properties. It can only be used for residential homes.

Pleas read this TurboTax article for more information:

https://turbotax.intuit.com/tax-tools/tax-tips/Tax-Deductions-and-Credits/Federal-Tax-Credit-for-Sol...

[ksb2]

Solar Energy Tax Credits (ITC) is  available to businesses such as LLCs, that have rental properties.

The applicable IRS code that applies is ITC under paragraph 48 and as defined under Section 38.

Refer to section 48 (a)(3)(A) i.  Form 3468 may be used to claim the ITC

[eltax3613]

October 31, 2019

Maximizing the QBI deduction with UBIA property

October 24, 2019

When do payments to clergy move from gifts to remuneration?

October 10, 2019

Health savings accounts can save taxpayers money

August 29, 2019

The solar energy credit: Where to draw the line?

August 15, 2019

A

Business credit

While Sec. 25D does not allow a solar tax credit for the cost of installing solar panels for use in residential rental property, Sec. 48 is more favorable. Sec. 48 provides for a solar energy tax credit for the installation of solar panels as part of the general business credit under Sec. 38. Under Sec. 48(a)(5)(D), property that is eligible for the general business credit is tangible property for which depreciation is allowable. Solar panels installed for use in residential rental property meet this requirement.

 

[AMBadri]

Do I have to then reduce the basis of the solar panels by the amount of the credit for depreciation purposes ?

[DianeW777]

Not the solar credit, the Investment Tax Credit (ITC) for businesses. The solar energy credit is reserved for your main residence, NOT a rental property.  You may be able to take the Investment Tax Credit (ITC) using Form 3468, if you qualify.  See page 4, for Line 7, under Qualifying Advanced Energy Project Credit.

• What is Form 3468 Investment Tax Credit

1. Sign into your TurboTax account > Search (upper right) > type form 3468 > press enter > select the Jump to ... link
2. Menu selection is Wages & Income > Other Business Situations > Business Credits  Start or Revisit > Investment credit Start or Revisit
3. Regardless of your path begin to answer the questions and complete the section to receive your credit.

Yes, you must reduce your cost basis by the amount of the credit you receive

The details and qualifications can be reviewed here for the solar credit.

[jarcom]

Hello,

I own a llc that does real estate. The address of the LLC is my home. Do you know if i can get solar panels in my house  as part of section 48? I would rather do that as section 48 allows to carry back the tax credit one year and that's the part i am more interested in. 

thanks,

[ErnieS0]

Yes. An LLC can claim a credit for the installation of solar panels by filing Form 3468 with the LLC return.

[bravo0123]

Interesting the people here who just give wrong answers.  The depreciation amount is 85% of the total cost.  Yes the credit is 30% which would seem to lower the amount to 70%, but the IRS allows half of that credit to be counted.  Thus 85%

[jrayman71]

What about a commercial rental listed under Schedule E of a personal tax return (the property is listed as an asset of a single member LLC), where and what form to report the solar panel credit (as well as listing as a LHI/Asset to be depreciated).