Solar Tax Credits in Florida: Past and Present

Florida Solar Incentives
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Solar Tax Credits in Florida: Past and Present

When it comes to solar incentives in America, some of the best are tax incentives. For example, the federal solar tax credit (ITC) is one of the most popular and valuable solar incentives. Some states have tax credits for state income tax. They also offer tax credits and exemptions for other taxes associated with solar purchases. In this post, you will discover whether Florida also offers solar incentives.

What Solar Tax Credits Exist in Florida Today?

There is no Florida income tax credit — because there is no income tax in Florida. For many states, the state-level income tax credit is one of the chief ways they save on going solar. However, in Florida, the federal solar tax credit is the only income tax credit

So what solar tax credits are available for Florida homeowners? Let’s take a look.

Florida Solar Property Tax Exemption

While not properly a tax credit — instead a tax exemption — Florida offers a property tax abatement for all renewable energy generation devices. Any renewable energy production equipment, including solar panels, solar inverters, and wiring. Solar battery backup also qualifies for the property tax exemption if charged solely from renewable energy.

How Much Does the Property Tax Exemption Save?

The property tax rate is 0.98 percent, though that also depends on your Florida county. These taxes come to an average of around $1,800 per year. After looking at the average cost of a solar installation, you’ll save anywhere from $180 to $200 on your property taxes after installing solar. 

Florida Solar Sales Tax Exemption

Alongside the property tax exemption, Florida also offers a sales tax exemption. Like the property tax exemption, the sales tax abatement applies for solar equipment, including your panels and inverter. Other solar products, such as wiring or battery backup, may also qualify for a sales tax exemption. However, labor costs aren’t included.

How Much Does the Sales Tax Exemption Save?

The sales tax in Florida is six percent for most things — including solar products. After accounting for the average cost of solar in Florida, the Florida solar sales tax exemption can save as much as $1,000.

Are There Other Solar Tax Credits in Florida?

When we look for explicit tax credits, we come up empty. The only official tax credit available to Florida solar homeowners is the federal solar income tax credit. The federal tax credit is worth 26 percent of the cost of the system.

Why Is the Federal ITC Different From Florida Solar Tax Exemptions?

The main thing that sets the federal tax credit apart from the Florida tax exemptions is that the federal tax credit applies directly to your federal income taxes. It will apply directly to your income tax and roll over for multiple years if it exceeds the taxes due in one year. Finally, unlike sale and property tax exemptions, the federal ITC covers solar permitting, labor costs, and equipment fees.

How Much Will the Federal Income Tax Credit Save?

The federal income tax credit will save Florida homeowners who pay the average price for a solar installation up to $4,000. These savings are more than both of the other exemptions combined. However, the actual amount might be less if your solar panel installation costs less. Along with tax incentives, net metering plays a key role in saving money for Florida solar homeowners. Don’t forget to check out what net metering policies are available for you.

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