Solar Is Here to Stay
Despite new tariffs on imported solar roofing technology, solar is still a great choice for homeowners interested in renewable energy. Because of the extension of the 2015 solar investment tax credit, homeowners can deduct a great deal of the total cost of solar equipment if they purchase materials before the end of 2019.
Let’s examine the ITC (the investment tax credit) to see how it affects the price of solar technology, as well as the likelihood of price fluctuations.
How does the ITC impact solar households?
Homeowners who choose to install solar roofing technology are thinking about how their choices impact the environment, but they’re also concerned with the overall cost.
Solar, after all, is not a cheap roofing option. But that’s why the ITC is important. The ITC allows homeowners to deduct a percentage of their solar technology, including installation costs, from their taxes at the end of the year.
What's the timeframe for tax deductions?
If purchased through 2019, homeowners can deduct 30% from their solar purchase. After 2019, the percentage drops each year, finally stopping at 10% at the end of 2022. The percentage comes out of your tax liability; in other words, what you owe the government after calculating income, exemptions, and assets.
If your tax liability is less than the 30% portion of the solar installation, the balance is rolled over until the next tax year. Depending on your financial situation, you could potentially spend several years tax-free. Learn how to claim the credit here.
How will federal tariffs impact solar prices?
Recently, the solar roofing industry took a minor hit as the government approved tariff increases on foreign solar panels. Solar installers were nervous that the tariff – which starts at 30% and drops to 15% after four years – would drastically increase the price of solar systems. The high tariff would be passed onto the buyer, driving up the sales price.
Thankfully, it appears the kneejerk reactions may not be accurate.
The Chinese solar manufacturer JinkoSolar announced plans to build a new facility on US soil. JinkoSolar is a massive player in the solar industry, so if they open a plant in the United States, the new tariff would not be applied. What all this means for curious customers is that solar system prices should hold steady in the meantime, allowing customers to take full advantage of the ITC credit.
Solar materials are here to stay
It’s time for curious homeowners to treat solar as a serious option rather than a passing trend. Consumer watchdog groups agree that panels are a solid purchase if you have the cash.
Price increases are likely to be small, and you’re still guaranteed the maximum tax savings if you buy now, in addition to what you’ll get back on electricity.
One of the biggest drawbacks to solar is finding a contractor who can install the system correctly. They haven’t been on the market long enough for most contractors to become familiar with them.
At Hometown Roofing Contractors, we'll match you up with the best roofing contractor for the job. Customers can research all kinds of contractors, see what other customers have to say about their services, and request multiple quotes.