2019 Is Final Year To Receive Full Tax Benefits For Renewable Energy Systems
If you’ve been thinking about installing a solar energy system for your home, the Minnesota Commerce Department suggests that you may want to finally catch the sun in 2019.
That’s because 2019 is the last year to claim the full 30 percent Residential Renewable Energy Tax Credit, which applies to solar energy projects (electric or hot water), small wind installations, ground source heat pumps and other eligible renewable energy systems.
This incentive allows you to claim a 30 percent credit on your federal tax return for the costs of the system. Your tax credit on a $20,000 system would be about $6,000, resulting in a dollar-for-dollar reduction on your income tax.
To get the tax credit, you must own the system instead of leasing it. Eligible costs include labor for on-site preparation, assembly or original system installation, and piping or wiring to connect a system to the home.
To get the full 30 percent tax credit, your system must be installed by December 31, 2019. If the installation is at a new home, the “placed in service” date is your date of occupancy.
The tax credit, which ends in 2022, will phase down over the next three years:
- 26 percent for systems placed in service after Dec. 31, 2019, and before Jan. 1, 2021
- 22 percent for systems placed in service after Dec. 31, 2020, and before Jan. 1, 2022
A similar Business Energy Investment Tax Credit is available for businesses, also with a phase-down schedule.