Wondering about how does the solar tax credit work in Maui?

The cost of installing a PV system for your home can be steep and many families on the island are concerned that going solar is expensive. Unless you have a lot of money saved up, paying for a solar panel system can be overwhelming.

That in mind though, there are (still) ways you can save!

When you decide to solar, about 30% of the cost of the equipment, permitting and installation may be covered by the solar tax credit.

So, how does the solar tax credit work in Maui? Here’s a short guide explaining what is the Federal Tax Credit for solar and how it works.

How does the solar tax credit work in Maui?

For the time being, the federal government still allows you to claim a tax credit if you decide to go solar. In other words, the government wants to ‘reward’ homeowners who decide to make this type of long term investment.

But why are we using the term “still”?

As much as it makes sense to go solar, next year the credit will step down in value.

In 2019, you may still be eligible to ask for a 30% federal tax credit. Come 2020 though, the number will drop to 26%. In 2021, the incentives will become even less, 22% and by 2022, the program aimed at residential properties will come to a complete end.

This means that the time to go solar is now! If you don’t have a way to invest in a PV system this year, consider making an effort to go green in 2020 or the next calendar year.

How much money can you save on your installation?

A 30% tax credit can save you thousands! For instance, if the cost of your solar installation would add up to $10,000, you could deduct up to $3,000 on your taxes.

Keep in mind though, you need to owe taxes in order to qualify for the incentive. Furthermore, you have to own your PV system in order to claim the credit. This meas that leasing a PV system won’t work. So even though you still get to save money when consuming energy, you should avoid leasing your system and make an effort to invest in your own.

How can you claim your tax credit on Maui?

What do you need to do in order to claim your incentive?

First of all, look for the best solar installer on Maui. The right provider will not only install your system correctly, but they’ll guide you to choose the best PV system for your needs and assist you when it comes to accessing the federal and state incentives.

Second, make sure to keep track of your receipts. When it comes to the way the solar tax credit works on Maui, you are allowed to claim expenses that include the solar equipment, consulting costs, permitting fees and of course, professional installer expenses.

Once you install and pay for your system, you simply need to let the government know you’re ready to claim your credit. Consult with a tax professional before you file your taxes and find out more on the correct way to claim your incentive.