You may have heard stories about people being misled and fed false information by solar panel salespeople. Falling prey to these scams can end up costing you thousands of dollars.

Some sales reps may tell you that time is running out to claim this credit. Not to throw “shade” on their sales tactics, but the current credit remains in effect until 2032.

Make sure and educate yourself about the Residential Clean Energy Credit before purchasing solar panels for your home.

Key Points:

• The Credit equals 30% of the cost of new, qualified, clean energy property for your home installed anytime from 2022 through 2032.
• The solar panels must be installed on your main home.
• Solar roofing tiles and solar shingles qualify but roof trusses and traditional shingles that support solar panels don’t.
• When calculating the credit, you may need to subtract subsidies, rebates or other financial incentives you receive.

The Residential Clean Energy Credit is a non-refundable tax credit. A non-refundable tax credit is a credit that decreases your federal income tax liability to zero but does not result in a tax refund. If you are retired, a disabled veteran, or your income falls below the filing threshold, you may qualify for the tax credit but may not receive a tax benefit since you do not have a tax liability.

Remember, before committing to any purchase which claims to have a tax implication, always consult a tax professional.

If you need help finding a tax return preparer, visit our Get Help page for more information. For more updates from the Taxpayer Advocate Service, visit the news and information center to read the latest tax tips, blogs, alerts and more.

Resources

• Form 5695, Residential Clean Energy Credit
• Instructions for Form 5695
• IRS’ Residential Energy Credit page: Residential Clean Energy Credit | Internal Revenue Service (irs.gov)