Florida Solar Incentives & Tax Credits [2024]

News

/

Florida Solar Incentives & Tax Credits [2024]

Solar Panels on house roof

Shifting to solar power gives Florida homeowners a variety of benefits, including:

  • Lower utility bills
  • Lower maintenance costs
  • increased property value
  • Energy independence
  • Reduced carbon emissions

Plus, homeowners who install solar panels can claim several tax benefits. These tax incentives help offset the initial investment, making it easier for anyone to go solar. In this guide, we’re going to look at Florida solar incentives to understand how you can save money. Let’s get started!

Key Takeaways

  • Florida homeowners can receive solar tax benefits at the federal, state, and local levels.
  • Most solar companies also offer incentive programs to help Floridians make the switch.
  • Because of these incentive programs, reaping the benefits of solar power is easier than ever.

Federal Solar Incentives

Homeowners feel relieved when they realize how beneficial the incentives to go solar are in Florida

Federal Solar Tax Credit

The primary Florida solar incentive is the federal solar tax credit. This credit allows homeowners to claim a percentage of the total cost of installing solar equipment in their homes. You can then use this credit to reduce your federal income taxes. The rate you can claim depends on the year that you installed (or will install) solar equipment.

  • For solar equipment installed between 2017 and 2019, the rate is 30%.
  • For solar equipment installed in 2020 or 2021, the rate is 26%.
  • For solar equipment installed between 2022 and 2032, the rate is 30%.
  • For solar equipment installed in 2033, the rate is 26%.
  • For solar equipment installed in 2034, the rate is 22%.

After 2034, the federal solar credit program is scheduled to expire. Note that because this is a credit, you can subtract it directly from your tax bill. This is in contrast with a deduction, which would only allow you to reduce your taxable income. There is also no limit on how much tax credit you can claim using the federal solar tax credit.

Calculating Your Solar Tax Credit

Let’s look at an example. In 2023, you invest $10,000 to install solar panels. Using the federal solar tax credit for that year (30%), you can claim a credit of $3,000 (30% x $10,000 = $3,000). Now, let’s say you owe $15,000 in federal income taxes in 2024. After subtracting your $3,000 federal solar tax credit, you will only owe $12,000.

Note that this is a non-refundable tax credit. If the credit available to you exceeds your tax bill, you will not receive the balance as a refund. However, you can roll it over to subtract from future years.

What Expenses Are Covered by the Solar Tax Credit?

The following expenses can be included when calculating your solar tax credit:

  • Solar panels
  • Solar cells
  • Installation and labor costs
  • Balance-of-system equipment, including wiring, inverters, and mounting equipment
  • Energy storage devices (solar batteries) with a capacity of at least 3 kWh
  • Sales tax on eligible expenses

Is the Solar Tax Credit a One-Time Credit?

Yes. The federal solar tax credit is only available once for each system installed. However, it is possible to carry the unused amount forward. For example, if your tax credit is larger than your tax bill, you can apply the excess to another tax year.

Am I Eligible for the Federal Solar Tax Credit?

To claim the federal solar tax credit, you must meet the following requirements:

  • You must install the solar equipment at your U.S. residence
  • The solar equipment must be installed between January 1, 2017, and December 31, 2034.
  • You must own the solar equipment yourself, either purchased with cash or financed through a loan. (The federal solar tax credit does not apply if the solar equipment is under lease or acquired through a power purchase agreement.)
  • The solar equipment must be newly installed or put into service in the year you claim the credit.

As long as you meet these standards, you should be eligible for the federal solar tax credit.

How Do I Apply for Solar Tax Credit in Florida?

To claim the solar tax credit, complete IRS Form 5695 and attach it to your federal tax return. You can learn more by reviewing the instructions provided with the form.

Florida Solar Incentives

To receive tax credits among the other incentives, homeowners must get a solar installation in the United States

In addition to the federal solar credit, Florida homeowners can claim tax benefits at the state level, too. These Florida solar incentives make it even easier to make the switch to solar power.

Solar System Property Tax Exemption

One of the best Florida solar incentives is a property tax exemption for solar equipment. Under state law, eligible renewable energy additions or installations that add value to homes, such as a solar power system, are excluded from the property’s taxable value.

Home Solar System Sales Tax Exemption

According to Florida statutes, all solar energy systems purchased and installed in the Sunshine State are exempt from sales tax. This means that you can save 6% of what you would usually pay when installing solar equipment.

Net Metering

In addition to tax credits and exemptions, another Florida solar incentive is the net metering program. When you connect your solar system to the electric grid, you can “sell” the excess power you generate to your utility provider. Your provider will then deduct the value of that power from your energy bill. In some cases, they may even pay you in cash.

Local Florida Solar Incentive Programs

Many local electric cooperatives and municipal utilities offer solar incentives for Florida homeowners. For example, the Orlando Utilities Commission (OUC) offers discount pricing and rebate programs for homeowners who install solar panels in the Orlando area.

Solar Provider Incentives

Most companies that sell or install solar panels offer their own incentive programs. For example, at Current Home, we give new customers affordable financing options with $0 down and 12 months of free energy. This lets homeowners reap the benefits of solar power without having to make any upfront investment.

Save More with Solar

Are you ready to go solar? If so, the many Florida solar incentives available will make the transition easier than ever. And when you work with Current Home, you’ll get one full year of solar power 100% free.

Claim your free quote today!