There is excellent news for solar this festive season!
The Federal Investment Tax Credit (ITC) for solar has been extended as part of the COVID-19 Stimulus Bill, signed into law by the President on December 27th 2020.
US federal tax payers who purchase and install a solar system in 2021 and 2022 will now be eligible for a 26% income tax credit.
The credit had been scheduled to drop to 22% in 2021. The 22% credit is now pushed back to 2023. The solar tax credit extension means that customers can continue to benefit from the generous incentive to lower the cost of their solar and battery system significantly.
Used together with the Hawaii state tax credit (35% for Hawaii residents and 24.5% for non-residents), the 26% ITC can lower the total cost of a solar system by 50% or more.
2021 installation tax credit example:
8KWDC + 1 Tesla Powerwall 2.0
Total investment:
$44,000 Federal Tax Credit (26%)
$11,440 State of Hawaii Tax Credit (35%, capped at $5k per 5kW) $10,000
Total Cost (after tax credits): $22,560
Tax credits reduce project cost by 49%!
You can read more about it here.