Tax Credit for Residential Solar Panels

solar panels on modern housesSolar panels are still pretty pricey due to the advanced technology and thin-film curvature measurement tools required in the production of solar cells. However, they’re not out of reach, and there’re some additional incentives after you do the installation. If you installed the panels in the U.S. last year, you can get a tax credit.

In your tax return you can claim 30 percent from the cost of the panels as a tax credit. You can apply this credit only for the properties where you reside either full time or temporarily, but not for rental income properties.

According to the IRS, you need to fill out Form 5695, make the calculations and enter the credit amount in your 1040 tax return. If your solar panel credit will be higher than your tax bill, you can’t get the difference back, but you will be able to roll the credit over to the next tax year.

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