solar panel credit

[yahira]

Good morning.  I am trying to close the contract to install solar panels in my home before the ending period ends.  Would i be getting a 30% credit of the cost on my return?  How does this work?  And do i have to turn in this credit back to the finance co?  The sales rep stated that this check i would have to turn it back in to the loan company because it is something that government is giving but it is not ours to keep.  Is this true?  Please let me know as soon as possible.  Thank you.

[Critter]

Well I would say it is a bunch of baloney however I think you may not be fully understanding what the sales rep is saying ... many times they work it into the contract that  IF  you use the credit from your return it will pay down the balance due and the payments.  Normally they will show you both ways to finance the panels ... with and without using the credit to pay down the balance due but at no time is the credit theirs ... it is part of your tax return so it is yours to use as you see fit.   

Now most times I have found that the amount they say you will get as a credit may not be correct for your income tax situation ... the credit is NOT refundable so you may not actually see it in the refund ... review your tax return to see how it would or would not work for you. 

[DoninGA]

See this TurboTax Tax Tip for the solar energy credit - https://turbotax.intuit.com/tax-tips/going-green/federal-tax-credit-for-solar-energy/L7s9ZiB4D

The Residential Energy Efficient Property Credit is reported on your federal tax return using IRS Form 5695.  It is a credit which reduces your tax liability on your federal tax return.  If the credit reduces your tax liability to zero then the remainder of the credit is carried forward to the next tax year.  If your total tax payments are greater than your total tax liability then you will receive a tax refund for the overpayment.

The federal tax refund is yours.  You have no obligation whatsoever to give your federal tax refund to anyone.

You receive on your tax return a credit of 30% of the cost for the solar panels and installation.  The installation must be completed on or before 12/31/2019 to be reported on your 2019 federal tax return.

IRS Form 5695 Residential Energy Credit - https://www.irs.gov/pub/irs-pdf/f5695.pdf

IRS Form 5695 instructions - https://www.irs.gov/pub/irs-pdf/i5695.pdf

[bfamily9]

Here's another consideration. If you haven't started your project yet, I doubt very much that it will be completed this tax year. The 30% credit is reduced in subsequent years. It's down to 26% in 2020.

[TomD8]

The tax credit is yours if you are buying the new solar panels.  But if you are leasing them, the credit belongs to the leasing company.  That's because the credit goes to the actual owner of the panels.