How The Solar Tax Credit Works

TC stands for Solar Investment Tax Credit and is the most important solar incentive in the United States. This credit is offered by the U.S. Federal Government, allowing homeowners and commercial businesses to make solar more affordable. Solar installations completed before December 31st, 2019 are eligible for a 30% tax credit. In the year of 2020, the Tax Credit drops to 26%, followed by 22% in 2021. Starting January 2022, homeowners will no longer be eligible for the tax credit. The Solar Investment Tax Credit is a non-refundable credit. In order to claim the full credit amount, you will need to owe the same amount or more in taxes. If the amount you owe in taxes does not meet your ITC amount, you can still take the credit but space it out over more than a year period of time.