2010 end of year rush

Now is the time to make something happen with solar energy.

There are a few things that will be expiring on December 31, 2010 and so it makes sense to “make hay while the sun is shining.”

The first and most valuable expiring incentive for solar and renewable energy projects is the 1603 Treasury Grant. This grant is taken instead of the 30% federal tax credit. This tax credit allows anyone to get a tax credit for 30% of the installed cost of any PV system (with no upper limit). So if you installed a $100k PV system you would be able to get $30k as a tax credit on your 2011 tax return. If this is more than you owe then the tax credit can be rolled over to the next year taxes (20 years for businesses, until 2016 for individuals).

A business can use the 1603 treasury grant rather than the Federal tax credit. This allows a business to get 30% of the cost of the PV system (again- no upper limit) back as a check 60 days after they apply for it. This is much more valuable for businesses that do not have a very large tax liability or who want the return back immediately.

The next thing that is scheduled to expire is the Bonus depreciation on top of the MACRS. All PV systems are eligible for modified accelerated cost recovery system. This is quick depreciation over 5 years (rather than the longer lifespan).

Anyway, on top of the 5 year depreciation there is also a bonus depreciation of 50% in year ONE for the total cost of a PV system. This will expire on December 31, 2010 as well. Of course congress can retroactively apply this to 2011 (as they did in 2010), but to be safe it makes sense to use the deduction when we know that it is active.

There are many other local or state incentives which are expiring at the end of 2010 as well. For information about the specific incentives in your area please look at www.desireusa.org for a comprehensive listing of all PV incentives.

By the way, there is currently a PV module shortage as everyone tries to get their systems installed by the end of 2010 (so they can get tax benefits in April rather than NEXT April). Anyway, good luck on securing your system. We currently have modules in stock, so act quickly!


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