%20(19).png?width=800&height=500&name=CONTENT%20(800%20x%20500%20px)%20(19).png)
%20(17).png?width=500&height=312&name=CONTENT%20(800%20x%20500%20px)%20(17).png)
%20(18).png?width=500&height=312&name=CONTENT%20(800%20x%20500%20px)%20(18).png)
How Commercial Solar Incentives Work
30% Solar Investment Tax Credit (ITC)
Available to businesses and homeowners, this incentive will offset up to 30% of a solar purchase in the form of a federal incentive tax credit. To qualify, the business must have a tax liability upon filing. In other words, if the business owner receives money back from their tax return, the credit will not be applied for that year and will roll forward.
Through the Inflation Reduction Act, signed into law on August 16, 2022, the 30% ITC is now available for businesses through 2032. After that, the incentive drops to 26% in 2033 and decreases again to 22% in 2034 before dropping permanently to 10% for commercial projects and 0% for residential projects beginning on January 1, 2035.
State Solar Tax Credits
As of January 1, 2019, the Arizona state tax credit for commercial solar projects has been discontinued by the Arizona legislature. Please contact your state representative for more information.
MACRS Investment Depreciation
Every commercial solar system qualifies for the Modified Accelerated Cost Recovery System (MACRS), established in 1986 as a method of depreciation in which a business’s investments are recovered, for tax purposes, over a specified period via annual deductions. Qualifying solar equipment is eligible for a cost recovery period of up to five years.
USDA REAP Grants
The USDA established the Rural Energy for America Program (REAP) grant to assist agricultural producers with renewable energy investments. This REAP grant is available in select rural towns across the country with a population below a certain threshold and covers 25% of a solar investment up to $500,000 for qualifying businesses.
%20(6).svg)