Are you thinking about going solar? Did you know a federal solar tax credit can reduce the cost of a home solar-energy system by 30%?

Aside from the obvious benefits of installing a home solar system, like cost savings and an increase in your property value, another major perk that helps seal the deal for most homeowners looking to go solar is all the available tax rebates.

What are federal tax credits and incentives for solar and battery storage?

The federal solar incentive comes in the form of an investment tax credit (ITC), which is a credit you claim on your federal income taxes the same year you install your solar panels. The Federal Solar Investment Tax Credit has offered solar-energy system homeowners a rather generous one-time 30% deduction on their federal return. That credit can significantly reduce the cost of a rooftop solar energy system. 

In 2006, Congress introduced and continually renewed the Energy Policy Act under the Bush administration. In 2022, the Biden administration launched the Inflation Reduction Act (IRA), which included direct measures to make solar energy more affordable and accessible to homeowners nationwide.

The IRA comes with a $370 billion dollar budget, a large portion of which goes towards tax credits and incentives for clean energy improvements, like solar panels and battery storage.

Thanks to the new IRA nationwide incentive, you can claim 30% of the total installation cost of your solar home project on your federal income taxes.