As a way of supporting deployment of solar energy in the United States, the Federal Government has put The Solar Investment Tax Credit (ITC) as a policy mechanism overseeing the success of solar projects in America. Come December 31, 2016, the ITC for residential and commercial solar system will expire. There is a huge debate on whether the deadline will be extended or whether it will expire for good. Before looking at any changes that may occur, let’s take a look at the facts.
As of now, both residential and commercial properties are given 30% tax credits on solar installation placed before 31st December 2016.
After the expiry of the deadline, commercial property credits will drop from 30% to 10% while residential properties will drop to zero. This will be a drastic drop that will make both commercial and residential developers spend a lot of money in solar installation.
Unless the US Congress moves in to extend the deadlines, the changes outlined above will come into effect on 1 January, 2017.