30% Federal Solar Investment Tax Credit (ITC)

 The Inflation Reduction Act of 2022 increases the Federal Solar Investment Tax Credit (ITC) to 30% until 2032, meaning Homeowners who install solar on their property can now look forward to a 30% tax credit on their 2022 taxes. If you’ve already installed solar this year, don’t worry, the new law states that Homeowners who installed solar in 2022 can claim the 30% tax credit retroactively.

In addition to the 30% ITC, residents installing solar in disadvantaged communities are now eligible for a bonus tax credit of 10-20%. By addressing the inequities in green energy infrastructure, the new law will increase the amount of solar projects in low-moderate income communities.

There are also ‘adders’ included in the ITC which will allow some Homeowners to claim as much as a 50% tax credit. Depending on who installed the system, the location of the array, and whether the panels and components are American-made, some Homeowners may be eligible to cut their solar cost in half. 

The Inflation Reduction Act represents a huge reduction in carbon emissions and pollution, as well as many new green jobs, and a significant growth in energy independence for homeowners and communities affected by the rising costs of fossil fuels.