Possible Extension of the ITC

[wjgjr]

Reports are that the legislation expected to be approved today would extend the ITC. Clean Energy Investments Get A Bipartisan Boost From Congress In Relief Bill

Specifically, under the proposed new law, according to sources on the Hill, the existing 26 percent Investment Tax Credit (ITC) available for solar power projects that commence construction before the end of 2020 would be extended by two years, to year-end 2022. The amount of the credit would step down to 22 percent for projects that start construction before the end of 2023 (as opposed to stepping down in 2021 under current law), with further reductions and a phase-out to zero thereafter.

I also saw it mentioned in the Post (https://www.washingtonpost.com/busi...d710ac-4331-11eb-ac2a-3ac0f2b8ceeb_story.html) without all the details

The package also extends tax credits for renewable energy projects, including wind and solar production.

I am glad to see the ITC extended, though I would almost say in some ways it is too generous by not stepping down at all for three years, since it seems likely that technology should result in costs dropping over that time. In any case, if the reports are accurate (and nothing else upsets the plans to pass this) it will certainly help with those concerned about missing out on that 4% if projects are not done this year.

 

[jboy210]

I would not all be surprised to see the tax credit extended. The new administration is making clean energy a priority.

 

[wjgjr]

I would not all be surprised to see the tax credit extended. The new administration is making clean energy a priority.

Just to be clear, this is in reference to the bill being voted on today to fund the government and provide COVID-19 relief.

 

[bhzmark]

It's extended Solar credits extended 2 years (residential and commericial)

(well, subject to the signature of the orange one)

 

[holeydonut]

Since the 26% has been extended for 2 more years, ....

Yeah but you lose the time value of money if you get the credit on a 2021 tax filing vs a 2020 filing. And most people should shoot for a personal ROE of 10% to 15%. This will tie up liquidity from the OP a full year without any return.

I'm kind of curious what the installer did that was not ok. Like it was just the routing of the wires near the Gateway? Or did they run the wires through an existing box in a non-code-compliant-raceway?

 

[Alonzo]

Does the Solar ITC cover RV's, even if it's not primary residence?

 

[SMAlset]

If passed this would be great news for all those late to solar/PW purchasers who couldn’t be fit in this year or who simply couldn’t get any PWs for their order due to lack of inventory. I know from comments in the forum people were surprised how long it took from deposit to install & PTO, and nervousness was starting to set in around maybe August/Sept when install dates were pushed out to maybe late 2020 and then Q1 2021.

I think holding at 26% for a few years will encourage a lot more people to go solar and even add PWs or add to current PWs. Like EVs I don’t think the general populace is aware or knowledgeable on the subject. Battery production will be a huge challenge in the next few years and this decade. Now if only cities/ jurisdictions don’t make installing them prohibitive. Getting costs down another challenge for many. Not sure what the percentage is of those who don’t have availability to their roof for whatever reason but recently saw or heard a story about this being a big reason why solar can only expand so far in many cities.

 

[MP3Mike]

Yeah but you lose the time value of money if you get the credit on a 2021 tax filing vs a 2020 filing. And most people should shoot for a personal ROE of 10% to 15%. This will tie up liquidity from the OP a full year without any return.

It doesn't have to. If you know you are getting the tax credit you can change your number of exemptions with your employer, assuming you have a normal pay-check based job, so no/little tax is withheld until you have your tax credit money in-hand. Works for the EV tax credit as well, so you can have the money before you have even spent it. (Just make sure you actually get the tax credit or you could be stuck with penalties.)

 

[wjgjr]

It's extended Solar credits extended 2 years (residential and commericial)

(well, subject to the signature of the orange one)

Looks like this is an important caveat as it turns out, as we are all still waiting to see if it is signed. That said, as @jboy210 noted, I do think the next administration will prioritize clean energy, so I would think they would push to extend the credit even if this bill does not become law.

I wonder if the Tesla promise to reimburse the 4% difference covered the possibility of them paying out and then having the credit increased retroactively.

 

[holeydonut]

It doesn't have to. If you know you are getting the tax credit you can change your number of exemptions with your employer, assuming you have a normal pay-check based job, so no/little tax is withheld until you have your tax credit money in-hand. Works for the EV tax credit as well, so you can have the money before you have even spent it. (Just make sure you actually get the tax credit or you could be stuck with penalties.)

So you're saying someone could just punch in the value of the ITC discount they're expecting into line 4(b) of the new IRS W4. And then they technically would reap the benefit during the tax year instead of afterwards during the tax filing? I remember the good ol' days when the # of exemptions was kind of a sliding scale and was rather easy to manipulate.

This new W4 sucks... I don't know why the IRS switched to that wacky format.

 

[MP3Mike]

So you're saying someone could just punch in the value of the ITC discount they're expecting into line 4(b) of the new IRS W4. And then they technically would reap the benefit during the tax year instead of afterwards during the tax filing? I remember the good ol' days when the # of exemptions was kind of a sliding scale and was rather easy to manipulate.

This new W4 sucks... I don't know why the IRS switched to that wacky format.

I guess it has been too long since I have done that, and it is more complicated now. But yeah getting the proper amount in 4(b) is what would be needed, though I think it should be more than your expected tax credit. Hey, you can always try and see how it goes and if they are still withholding too much take another try at it.