If you own rental properties, you know how expensive the electric bills can be.
Installing solar panels is one of the best things you can do to reduce your electricity bills and increase profits for your rental properties. The installation will pay for itself in electricity bill savings, and right now, you can save 30% with the federal solar tax credit!
Keep reading to find out how you can claim the solar tax credit for your rental properties in 2024.
The federal solar tax credit (formally known as the Investment Tax Credit or ITC) is a commercial solar incentive that was implemented by the US government to encourage solar installations. Businesses are eligible for a tax credit worth 30% of their total solar panel and battery storage installation costs with no maximum. Rental properties, both long-term and short-term, are considered businesses and qualify for the commercial solar tax credit.
Before you can claim the commercial ITC, you need to make sure you qualify. To be eligible, your solar installation must meet the following criteria:
The ITC is a tax credit, not a deduction or a rebate. It reduces your federal income tax liability by 30% of your commercial solar installation costs. To claim the solar tax credit for your rental property:
To receive the tax credit in a given year, you must have commenced construction for your solar installation by December 31st of that year. The IRS defines “commenced construction” as either:
The IRS implemented these guidelines to ensure solar projects make continuous projects and are completed in a timely manner once construction has begun.
Ready to add solar panels to your rental properties? Boston Solar installs customized solar energy systems for homes and buildings of all sizes in New England. We’ve been in business for more than a decade and have installed thousands of solar energy systems. Our expert team can design a solar power system that will generate most or all of the electricity your rental property uses, significantly reducing your operating costs. We’ll make sure your project meets IRS requirements for the solar tax credit so you can maximize your savings.