Save 30% or More on Solar Installation Costs
Whether you’re a homeowner or business owner, the federal solar tax credit makes clean energy more affordable than ever.
What Is the Federal Solar Tax Credit?
There are Federal Solar Tax Credits available for both homeowners and businesses interested in solar.
- For homeowners, this is the Residential Clean Energy Credit.
- Businesses can take advantage of the Solar Investment Tax Credit (ITC).
These tax credits allow you deduct a percentage of your solar system costs from your federal taxes. That includes the cost of:
- Solar panels and inverters
- Labor and installation
- Electrical work and mounting equipment
- Battery storage (if 3kWh or larger)
- Permitting, inspections, and even sales tax
This is one of the most powerful financial incentives available — with up to 30% or more back depending on your project type.
Lock in Savings
Boost property value
Cut operating costs
Use clean energy
Beat rising prices
Enable battery backup
Residential Credit Timeline
The full credit value runs until 2032 and then phases out until 2035.
| Installation Year | Credit % |
|---|---|
| 2022 – 2032 | 30% |
| 2033 | 26% |
| 2034 | 22% |
| 2035+ | 0% |
Homeowners who install solar can claim 30% of their system cost as a nonrefundable tax credit through 2032.
Tax Credit Eligibility Checklist:
You own your solar system and it is not leasing or under a Power Purchase Agreement (PPA)
Your system is installed on your primary or secondary U.S. residence
Your solar equipment is new and in service
You have federal tax liability to claim the credit against
If you can’t use the entire credit this year, the unused amount rolls over to future years.
How to Claim a Residential Tax Credit in Michigan
- Install and activate your solar system.
- Save all invoices and documentation.
- File IRS Form 5695 with your federal tax return.
Your credit applies in the year your system is turned on and generating power.
Businesses, municipalities, schools, tribal entities, and other organizations installing solar can also qualify — with even greater flexibility and bonus incentives.
Tax Credit Eligibility Checklist:
System must be new and operational
Business or tax-exempt entity must own the system
Bonus credits and direct pay options available
Base Credit: 30%
Businesses get a 30% tax credit if:
The project is under 1 megawatt (MW)
OR
It meets prevailing wage and apprenticeship requirements
If labor standards aren’t met and the system is 1 MW or larger, the base credit drops to 6%.
Commercial Bonus Credits (Stackable)
Domestic Content + 10%
Uses U.S.-made solar panels and components
Energy Community +10%
Located in fossil-fuel-dependent or brownfield communities
Low-Income Incentives +10-20%
Serves or is located in low-income areas (via program application)
Maximum commercial credit with bonuses: Up to 50% of total system costs!
Credit Transfer & Direct Pay
- Businesses can sell their tax credit to another company for immediate cash.
- Non-profits, schools, and municipalities can receive the credit as a direct cash payment, even if they don’t pay taxes.
This unlocks federal incentives for organizations that previously couldn’t benefit.
How to Claim a Commercial Tax Credit in Michigan
- Bonus credits may require documentation and application.
- Consult your accountant or tax advisor.
- File IRS Form 3468 for the Investment Tax Credit
- Claim in the year your system is placed in service
Get Your Solar Panel Tax Credit Started Now
Whether you’re a homeowner, business owner, or nonprofit — we’ll help you make the most of every available tax incentive. From permitting to paperwork, we handle it all.
