Solar incentives are exciting, but a sometimes confusing topic to address. There is no "one-size-fits-all" way to apply solar rebates and tax credits, and as the packages expire and change, one might feel that understanding these incentives is like trying to hit a moving target.

2019 is an important year for these incentives, as several key drivers in the solar market are set to expire in the coming year. We're here to help you understand what is available to you as a solar customer right now, so you can cash in on these savings before they disappear!

The Federal Investment Tax Credit (ITC) is the most important of the bunch. The ITC offers 30% of your project costs back in the form of a tax rebate the year after you install a system. There is no cap on this resource, so many clients can see as much as $10,000 off their system cost as a result of utilizing this credit. Unfortunately, 2019 is customers last chance to get the full benefit of this credit.

Starting in 2020, the ITC rate steps down to 26%, and a further reduction to 22% will take place in 2021. After 2021, the residential credit is set to expire, while the industrial credit will remain at 10%. What does that mean for you?

In 2019, a 10kW solar system would get you approximately $7,800 in Federal Tax Incentives. Add that to $5,000 in NYS incentives, and an additional $3,500 from NYSERDA and you'd have a total incentive package of nearly $16,300 for your $26,000 system.

In 2020, that same incentive package will have dropped to $12,760.
In 2021, you'd be down to $14,220. In 2022, that incentive will fall off a cliff to just $8,500.

These numbers are nothing to scoff at. By investing in solar in 2019, you can claim nearly $4000 you'll leave on the table if you wait until 2020.

Like most capital improvement projects, Commercial solar customers can depreciate their solar investment as a means of getting tax relief on an ongoing basis. When the Federal ITC is taken on a project, the customer can still depreciate up to 85% of the taxable base of the project. With commercial customers, this amounts to tens or hundreds of thousands of dollars of tax relief.

Due to the most recent tax bill, customers can leverage 100% bonus depreciation on their project, or spread the depreciation over the standard 5-year MACRS schedule.

Lawmakers negotiate the NYS Solar Tax credit on a year-by-year basis. As long as NYS continues to push its nation-leading renewable goals, we don't see this credit going anywhere. A New York solar customer can get as much as 25% of their system cost, up to $5000 back in NYS tax credits when they invest in solar tech.

Additionally, NYS has created some additional tax programs to incentivize investment that make solar in the empire state even more attractive.

In addition to the NYS solar tax credit, NYS is one of 29 states in the country with a solar property tax exemption in place. The NYS Solar Property Tax Exemption is a powerful tool that helps you increase your home's value, without paying the price. When applicable, the addition of solar panels to your home is exempt from property tax increases for a solid fifteen years. Individual communities have the option to opt-out of this program, but to date, the vast majority of the state has honored this exemption. While in some residential scenarios the impact of this exemption might be minimal, for commercial clients access to this program means thousands in savings every year. Solar can increase a home or businesses value up to $3 per watt installed. For an average residential system, that's $21,000 in increased home value you don't need to pay taxes on!

In addition to the property tax exemption, solar customers don't need to worry about paying sales tax on their systems. NY is one of 18 states in the country that leverages the benefits of reduced sales tax. Unlike other types of capital improvement projects investing in solar comes tax-free, saving customers hundreds, if not thousands of dollars on the up-front costs of a project.

All of these benefits are currently accessible, and given NYS' recent goal of 100% renewable power by 2040, it's likely these programs will be expanded soon, rather than phased out.

The NYSERDA incentive program in New York State is one of the tools that put the value of solar over-the-top. This per-watt incentive has been available to residential and commercial customers since 2015 and can make a massive dent in your up-front costs.

The NYSERDA incentive is administered by the NY-SUN program, a government-funded initiative aimed at speeding up the adoption of solar in NYS. NYSERDA is granted funding through the NYS government and passes along these savings to customers through the use of specific incentive blocks. Each NYSERDA block offers a different per watt incentive, and when that block runs out, the incentive will lower for the subsequent block. Each region in NYS has its own block that applies to homes and businesses in that region.

As you can see, many of the blocks in NYS are about to expire. Given the incoming step-down of the Federal ITC credit, many NYS solar companies expect that by 2020 every NYSERDA block will have been used up and stepped down in some way, shape or form.

What does that mean for you as a customer? You might see as much as a $.15 per watt (40%!) reduction in available incentives if you wait until next year.

​All in all, you're lucky you live in New York State as a solar customer. The incentives available to make going solar affordable here in NYS are unparalleled, and as a prospective customer, you have the opportunity to make the most of those incentives before they start to run out!

Are you interested in leveraging some of these awesome benefits to buy a solar system that can save you thousands? Reach out to our team and we'll happily draft you a no-nonsense quote that will help you understand all the options available to you!