How to Get Your Money : Solar Energy Federal Tax Credit

You were told about a tax credit when you purchased your solar energy system. But did your sales representative tell you how to claim that tax credit? With only five weeks left to file your taxes for 2022, let me give you some quick instructions on getting your Federal Tax Credit filed for your new solar energy project.

*Disclaimer: I do not claim to be a tax accountant, nor is this legal, financial advice. This is informative information on filing your solar energy tax form. If you need help filing or if you believe you need help filling it out correctly, I advise you to seek professional tax help.

To be eligible for the federal tax credit:

• You must own the system outright or be financing it (not leasing it)

• The system must be located in the United States

• The system must be found at your primary residence

You will need to file IRS Form 5695 as part of your tax return.

1. Determine which products are qualified in Part I (pages 1-2)

2. On line 1, enter your project's total costs as written on the contract you signed. If you need a copy of your solar agreement, reach out to the representative you spoke to or contact the company you were installed by.

3. If you installed other eligible renewable energy products, list their costs in lines 2-5

4. On lines 6a and 6b, complete the calculations

5. On line 12, fill in the credit carryforward amount on any renewable energy installs that you have from 2021

6. On line 13, complete calculations (if you do not have a fuel cell, you will be ignoring lines 7-11)

7. On line 14, calculate any tax liability limitations using the IRS's Residential Clean Energy Credit Limit Worksheet (page 3)

8. On lines 15 and 16, complete the calculations

You can only claim your solar energy system once, but you can carry over any unused amount remaining on your tax credit that you could not use in a single tax year.

And remember, a tax credit is a credit towards what you could potentially owe in taxes. It is not necessarily money back to you.