One of the many reasons people often choose to get solar panels installed is that they have heard they can get special tax incentives. It is true that the government does offer some incentives for people who choose sustainable energy, but these incentives vary depending on your situation. Here is what you need to know about the tax perks for those who install solar panels at home.
The Investment Tax Credit
This is the big tax credit homeowners can take when they get solar panels installed. Also called the federal solar tax credit, this credit lets you deduct part of the cost of solar panel installation from your federal tax. Residents can choose to deduct 30% of the total cost of installation, which can be up to $9,000 depending on how much you pay for solar.
Idaho Income Tax Credit
Those who choose to have Magic Solar install their solar panels in Twin Falls or Buhl are also eligible to receive a state-specific credit that lets you reduce your tax liability by an amount equal to 7.4% of your solar installation costs. The credit is capped at $1,480. Unlike some other states, Idaho lets you get both the state solar tax credit and the federal tax credit.
Idaho Property Tax Exemptions
If you use a significant portion of your property to produce solar energy, you may be able to take advantage of a property tax exemption too. Property owners do not have to pay property tax for the part of their land that is related to solar energy. Instead, they just have to pay 3.5% of their gross energy earnings.
If you love saving money on your taxes and like the idea of free energy, solar panel installation is definitely something you should consider. Our experienced team can work on a variety of solar, micro-hydro, and other renewable energy projects. Call Magic Solar today to learn more about the services we offer.