Tax Minute
SOLAR PANELS
As you drive around the Commonwealth you will notice that more and more houses have solar panels on the roof or a solar field in the yard. The main reason many people put solar panels on their homes is because it is more environmentally friendly then using fossil fuels to generate electricity, but did you know that there are massive Federal tax credits for installing solar panels? There is a tax credit available to homeowners who install "alternative energy equipment" that is currently equal to 30% of what the homeowner spends on qualifying property such as solar panels, solar hot water heaters, geothermal heat pumps, and even wind turbines. The credit is on both the material and the labor costs to install the property. Although this credit was being slowly phased out, as part of the Inflation Reduction Act of 2022 the credit was extended at the 30% level through 2032.