Deductions for solar installation

[rogfam2023]

We paid $1,000 down for a solar energy system in Dec. 2023.  The installation and inspection should be completed this month (Feb. 2024) after we have paid the balance of the cost.  Is any of this project deductible on my 2023 tax form?

[DoninGA]

Since the installation will not be completed until 02/2024 the cost of the installation can only be entered on the 2024 tax return that you will file next year.

[Vanessa A]

No.  None of the project is deductible until you have the installation complete and the product is ready for use.  So if this occurs in 2024, then you will be able to claim the credit, including the $1,000 down payment made in December, on your 2024 tax return.

The Residential Energy Credit is a non-refundable credit, however this one can be carried forward to future tax years until this credit goes away which is currently set to happen in 2034

This credit is worth up to 30% of the cost of the equipment, with no maximum limit.  The items that fall into this category are as follows:

• Geothermal Heat Pumps
• Small Wind Turbines
• Solar Energy Systems
• Fuel Cells
• Battery Storage Technology