Solar Tax Credit

[Os4]

We installed solar panels and battery backup at our house in 2023. In addition, most of the cost of the installation was paid for in 2023. However, we are still awaiting final approval in 2024 at which time we will pay the balance due. I think I can claim the solar tax credit in 2023 because the equipment was installed in 2023 even though final approval will not be given until 2024. Any thoughts? Thanks.

[Bsch4477]

Deleted 

[AmeliesUncle]

The law says the credit for your personal home applies when "installation of the item is completed".

So in my opinion, that means the credit can be claimed for 2023.

[Os4]

Now I am wondering what constitutes a complete installation?

Was it a complete installation if the inspector denies to give the project final approval because of some outstanding issues and those outstanding issues are not addressed until the following year?

[Vanessa A]

Completed means you can use it and no more work needs to be done to it.  If you were not able to use it in 2023, then you would need to hold off until you file your 2024 return to take the credit. 

[Os4]

What if you were able to use it in 2023 but some additional work still had to be done in 2024 in order to pass inspection? Thanks.

[AmyC]

The  instructions for credit, IRS Form 5695, want to know when the item was placed in use.

Different upgrades create different tax breaks and some have limits. See here for the options and how they work together.