Solar federal credit - Can you claim multiple times? Upgrades & additions

[HB88]

This has garnered all kinds of opinions from people but also from CPA.

Question: If you own a home, install solar and Tesla battery backup system and apply and receive the Federal ITC tax credit in 2018 for example. Than in 2020 you install and add additional new solar panels to your existing system or add another battery to your backup system. Can you apply for the Federal ITC tax credit again on the new equipment, whether it be more panels or battery?

Looking for feedback based on IRS guidelines no opinion.

Thanks

[Opus 17]

There is nothing in 26 USC §25D that limits the credit to once per taxpayer or once per home.  You certainly can't claim the same cost twice, but if you are installing new capacity, there is nothing in the code that says you are not eligible.

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

[HB88]

Thanks for the feedback.

I guess I'm a little perplexed why a few CPA I have spoken with and one with strong conviction stated it is not possible to make a second claim.

In 26 USC §25D also I don't see anything specifically stating it is allowed either. Not sure why the IRS would leave this question unanswered as surely this can't be an uncommon issue with people expanding their systems.

[Opus 17 · Accepted solution]

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@HB88 wrote:

Thanks for the feedback.

I guess I'm a little perplexed why a few CPA I have spoken with and one with strong conviction stated it is not possible to make a second claim.

In 26 USC §25D also I don't see anything specifically stating it is allowed either. Not sure why the IRS would leave this question unanswered as surely this can't be an uncommon issue with people expanding their systems.

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Congress wrote the law, the issue is whether the IRS has, or should, write a regulation to cover this situation that is not described in the law.

I did find a private letter ruling that covers the battery issue.  

https://www.irs.gov/pub/irs-wd/201809003.pdf

https://www.ballardspahr.com/alertspublications/legalalerts/2018-03-07-irs-rules-solar-energy-storag...

First note that "Like all IRS private-letter rulings, the 2018 ruling is binding only on the taxpayer who received it and may not be used or cited as a precedent. It may provide guidance, however, as to the thinking of the IRS on the issues presented, and may indicate the likelihood that a proposed letter ruling involving similar facts will be approved."

Second, note that with respect at least to a battery system to store solar power and release it to your home at night or on cloudy days, the battery and it's connecting components are only "qualified solar property" if the battery is exclusively connected to the solar panels and can't be charged by the public utility grid.  So some whole house backup batteries may not be "qualified solar property."

The private letter ruling does not discuss new solar panel capacity but I see no reason to doubt my prior statement. 

[HB88]

I actually have a copy of that private letter ruling and agree it can't be used as precedence but sure does help if the IRS ever comes knocking.

I think we are in agreement the IRS has not clearly defined the ruling on this issue but nothing I've seen either precludes someone from making multiple claims.

Sounds like it is a safe bet to proceed.