The Idaho solar tax credit can make a big dent in the amount you have to pay Uncle Sam at tax time. If you’re an Idaho resident who’s been thinking about adopting solar power, this incentive makes it much easier and more affordable.
Not every state offers a solar investment tax credit (ITC). Many states have ended their programs, in response to the dropping costs of investing in a home PV system. But if you live in Idaho, you’re in luck.
How Much Can You Save with the Idaho Solar Tax Credit?
Of the state-level solar incentive programs, Idaho’s — called the Residential Alternative Energy Tax Deduction — is one of the strongest.
The first year after installing your home PV system, the Idaho solar tax credit allows you to deduct 40 percent of the cost of your photovoltaic power project when you file income taxes. Then, for the next three years, you’ll be eligible for a 20 percent state income tax deduction.
Each year, the maximum deduction is $5,000. So altogether, you can save up to $20,000 through the Idaho solar tax credit.
Can You Still Claim the Federal Solar Investment Tax Credit?
You absolutely can apply for both the federal and Idaho solar incentives — and you should. Together, these tax programs can cut your photovoltaic investment costs by 50 percent or more.
One important note — make sure to calculate tax credits on your net PV system cost. In other words, subtract other grants, rebates and installer or utility bonuses before figuring the amount of your claim. If you use the gross price, you could get a tax bill in the mail.
Does Idaho Have Other Financial Incentives for Going Solar?
If you’re an Idaho resident, you have yet another way to save on the switch to solar power.
The state of Idaho doesn’t have much else to offer in terms of solar financial incentives — no rebates for adopting photovoltaic power are available, and there’s no law requiring the utility companies to provide net metering.
All utility net metering programs give homeowners full retail rate credit for excess energy they produce with their photovoltaic panels. So in effect, you’ll pay for one less kilowatt of electricity for every kilowatt your Idaho solar PV system sends to the utility grid each month.
The professionals at Intermountain Wind & Solar can tell you more details about the solar financial incentives available to Idaho residents. We’re not accountants, so you may still want to speak to a tax professional. But if you simply need assistance filling out the federal or Idaho solar tax credit paperwork — or if you have other questions about home PV installation — contact us today.