The 2020 ITC Extension’s Impact on Residential Solar
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For many, the solar investment tax credit (ITC) has made residential solar an option for their residence by decreasing the cost of adding a system to their homes. As a result, the price of solar has gone down over the years. However, homeowners still need the support of this tax credit, especially with the economic turmoil that the pandemic has caused.
After some effort by solar advocates across the United States, an extension has arrived just in the nick of time. The current 26 percent credit had an expiration date set for December 2020.
Solar ITC Extension Within the COVID Relief Bill
While the COVID relief bill does cover unemployment insurance, stimulus checks, paycheck protection, vaccines, school assistance, rental assistance, farm aid, childcare, and postal service loan forgiveness, it also includes other legislation. As part of the COVID relief bill’s omnibus measure, a two-year solar ITC extension along with over 3,000 pages of other miscellaneous legislation has arrived bundled with it. Now the ITC will stay at 26 percent until 2022, at which point it will decrease to 22 percent and disappear in 2023. This extension comes as a great relief to the solar industry and interested homeowners. It allows interested parties that can’t qualify for solar now some time to get everything in order.
The Future of the COVID Relief Bill
Because of the immense amount of legislation packed into this package, it has taken months of debates and negotiating to reach this point. Thankfully, on Dec. 21st this year, Congress passed the bill. The president signed the bill a week later.
President Trump Gives a Hesitant Stamp of Approval
President Trump did sign the bill. However, only after insisting that the bill increase the COVID relief package from $600 per person to $2,000, and expressing his objections to unnecessary government spending.
Finalizing the COVID Relief Bill
While the President has every right to send Congress a red-lined version of the bill, it doesn’t mean they have to make any of his suggested changes. In the meantime, the implementation of measures in the bill has already started to take place.
The Impact the ITC Has on Residential Solar
As it stands, the ITC extension will help interested Americans across the country adopt solar. The 26 percent tax credit decreases the cost of solar by thousands of dollars. With the ITC, this energy option can compete with utility-generated electricity.