Federal Renewable Electricity Investment Tax Credit for Solar:
- The federal renewable investment tax credit (ITC) for solar is a tax credit that can be claimed on the federal income taxes of individuals or corporations for a portion of the cost of installing. The ITC is currently a federal tax credit claimed against the tax liability of residential (under Section 25D of the U.S. tax code) and commercial/utility (under Section 48 of the U.S. tax code) investors in solar energy property. The Section 25D residential ITC allows the homeowner to apply the credit to their personal income taxes. This credit is used when homeowners purchase solar systems and have them installed on their homes. In the case of the Section 48 credit, the business that installs and/or finances the project claims the credit.
- The ITC for solar power projects which would have expired in 2020 will now remain at 26% for projects that begin construction in 2021 and 2022, be reduced to 22% in 2023, and decrease to 10% in 2024 for commercial size projects. There will be no credit for small-scale solar by 2024.
Federal Renewable Production Tax Credit for Land-Based Wind:
- The federal renewable electricity production tax credit (PTC) for land-based wind is a federal tax credit included under Section 45 of the U.S. tax code for electricity generated by wind energy on a per kilowatt-hour (kWh) basis.
- The PTC for land-based wind power projects has been extended an additional year and will remain at 60% of the project’s value, on a per kWh basis, for projects that begin construction by the end of 2021. Previous law had the rate decreasing to 40%. Without any future legislative actions, there will be no wind PTC starting in 2022.
The link below provides you with information on tax deductions and credits in the State of Idaho.