clean energy credit for solar in 2025

[user17569064898]

Can you claim the credit for newly installed solar panels as soon as they are installed and paid for?

or do you have to wait for the utility company to recognize them on the grid?

Form 5695 appears to indicate you have to wait for the solar system to be in service and generating power.

"File Form 5695, Residential Energy Credits when you file your tax return for year in which your residential energy property was put in service.

thanks!

[AmeliesUncle]

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@user17569064898 wrote:

"File Form 5695, Residential Energy Credits when you file your tax return for year in which your residential energy property was put in service.

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I'm curious where you are seeing the sentence.

At any rate, the law says "when the original installation of the item is completed".  My interpretation of that is that the credit applies when it is installed, regardless if the utility company has approved it or not.

[user17569064898]

I'm seeing that language in  

https://www.irs.gov/pub/irs-pdf/p5977.pdf

which is referenced at the bottom of the IRS page explaining the Residential Clean Energy Credit

https://www.irs.gov/credits-deductions/residen[product key removed]y-credit 

[AmeliesUncle]

Interesting.  At any rate, that is not how the law phrases it, as I mentioned before.

[user17569064898]

can you direct me to where I can read that Law outside of the IRS website?

[AmeliesUncle]

I'll try to give you a link below, but this forum often censors links, so if the link doesn't work, you can Google "Tax Code IRC 25D".

That section (25D) of the Tax Code gives a credit for an "expenditure" for solar and other things.  Then under the special rules, (e)(8) says when the "expenditure" is considered as made.

(8) When expenditure made; amount of expenditure

(A) In general

Except as provided in subparagraph (B), an expenditure with respect to an item shall be treated as made when the original installation of the item is completed.

https://www.law.cornell.edu/uscode/text/26/25D