How Your Business Can Cash in on Solar Tax Credits
Beginning in 2016, businesses and individuals alike have begun to cash in on solar tax credits. This is due to the fact that a law was passed to make solar devices more affordable and to provide businesses with a solar credit the next time they have to pay taxes. You can take advantage of substantial savings for your business if you know what exactly to acquire.
In its simplest form, businesses are being incentivized to install more energy efficient products around the company. Many light bulbs and electronic devices consume a ton of energy, and that means more pollution in the environment. The goal of offering a tax credit is to get businesses to install environmentally-friendly products around the building, and then you can deduct 30 percent of however much the installation cost from your annual taxes. An extra bonus is that many of these products will result in lower electric bills month-to-month, so there are some great savings to be gained by installing the right devices.
If this seems too good to be true, you have no reason to fret. You have plenty of time to take advantage of everything the solar credit has to offer. Until 2019, you can deduct up to 30 percent from your taxes. That number goes down to 26 percent in 2020, and it continues to lower every year. However, it is always possible that Congress will enact more legislation to keep the tax credits going strong, so you never know what is going to happen.
One important aspect to bear in mind is that you must purchase the solar item instead of leasing it. If you merely rent something, then you are not technically the owner, so you cannot deduct the rental cost from your taxes. If you have any questions or concerns about what items count toward the tax credit, you can speak with your accountant. Let him or her know that you have purchased a solar device within the last year, and he or she will know what deductions to include in your tax forms. In the event you handle your company’s taxes, then make sure you read up so that you know exactly how much to take away.
The government wants businesses to be more proactive in doing their part for the planet. That is why the federal government is offering such attractive tax rates. Take advantage of this solar credit by seeing what items qualify and how much it will cost you to install it.