Solar Credit Update – Good News

We had warned you last week that solar tax credits were set to expire at the end of the year. The good news is that, as part of the financial bailout package signed last week, these federal tax credits have just been extended and increased.  Bob Winn, owner of Sky Power Systems, a Diamond Certified company, says the changes will benefit both homeowners and businesses planning solar projects.

Mr. Winn says the 12/31/08 expiration has been extended to 12/31/16 and the $2,000 cap has been removed (effective 1/1/09), meaning residential customers will get a full 30% tax federal credit. That credit is not subject to the alternative minimum tax, like the current $2,000 credit.   This amounts to $9,000 for the average residential system!  The tax credit is calculated on the net cost of the project after a California Solar Initiative rebate from PG&E.  Commercial installations continue to get the 30% tax credit, which was also set to expire 12/31/08.