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I installed solar panels. When can I take the federal tax credit? – NJ.com

Solar Panel Installation

Q. I am about to sign a contract to install solar panels on my roof. If the panel installation was completed before Jan. 1 but the connection to my electric utility is after Jan. 1, can I claim the federal tax credit on my 2022 or 2023 federal tax return?

— Homeowner

A. We hope the panel installation went well.

It’s a big undertaking.

The federal residential solar energy credit is a tax credit that can be claimed on federal income taxes for a percentage of the cost of installing a residential solar photovoltaics (PV) system paid for by the taxpayer, according to the Energy Department’s website.

The installation of the system must be complete during the tax year, said Gerard Papetti, a certified financial planner and certified public accountant with U.S. Financial Services in Fairfield.

Solar PV systems installed in 2020 and 2021 were eligible for a 26% tax credit, he said. In August 2022, Congress passed an extension of the Investment Tax Credit (ITC), raising it to 30% for the installation of which was between 2022 and 2032, he said. Systems installed on or before December 31, 2019 were also eligible for a 30% tax credit.

“It will decrease to 26% for systems installed in 2033 and to 22% for systems installed in 2034,” he said. “The tax credit expires starting in 2035 unless Congress renews it.”

There is no maximum amount that can be claimed, he said.

Based on rules put forth by the Energy Department, as long as the installation was completed in 2022 you can claim the credit on your 2022 tax return, Papetti said.

Email your questions to [email protected].

Karin Price Mueller writes the Bamboozled column for NJ Advance Media and is the founder of NJMoneyHelp.com. Follow NJMoneyHelp on Twitter @NJMoneyHelp. Find NJMoneyHelp on Facebook. Sign up for NJMoneyHelp.com’s weekly e-newsletter.

Source: https://news.google.com/__i/rss/rd/articles/CBMiZGh0dHBzOi8vd3d3Lm5qLmNvbS9uZXdzLzIwMjMvMDEvaS1pbnN0YWxsZWQtc29sYXItcGFuZWxzLXdoZW4tY2FuLWktdGFrZS10aGUtZmVkZXJhbC10YXgtY3JlZGl0Lmh0bWzSAXNodHRwczovL3d3dy5uai5jb20vbmV3cy8yMDIzLzAxL2ktaW5zdGFsbGVkLXNvbGFyLXBhbmVscy13aGVuLWNhbi1pLXRha2UtdGhlLWZlZGVyYWwtdGF4LWNyZWRpdC5odG1sP291dHB1dFR5cGU9YW1w?oc=5

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