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Louisiana Solar Tax Credits – Demystified (Updated September, 2015)

how do solar tax credits work

With or Without Tax Credits we are here (unlike the others)!

Gulf South Solar opened in 2003 and was installing solar power systems for our customers 5 YEARS BEFORE TAX CREDITS.  Before any other solar company opened, Gulf South Solar testified at the Louisiana Capital to get our customers solar tax credits .  We hope OUR customers take advantage of the tax credits which have been in place for 8 years.  A side result of our Louisiana tax credit have been “pop-up” solar companies around the state.  When the tax credit is gone you can say good-bye to them.  We’ll be here, Lord willing, when the tax credits and solar pop-ups are gone.  You will be paying a bit more as the solar tax credits go away, but solar prices have dropped 50% since we started.

Please act quickly if you have been considering solar!   Thanks to the 30%  Federal Tax Credit, and the revised Louisiana 50%  tax credit (capped now at $10M/year, first come, first served), it is very affordable to get a solar system installed on your home.   With the 30% tax credit expiring in 2016, don’t delay another week because of the recent changes.   Contact us now to get started before it’s too late.  See the blog for the latest …

How Do the Tax Credits Work Today?

Federal Incentives

One of the provisions of The Emergency Economic Stabilization Act of 2008 is the extension of the Investment Tax Credit that gives homeowners 30% off solar power systems. This means a credit or direct reduction of the tax you owe. The best news of all is the removal of the $2,000 cap on what the federal government will pay you back (effective 1-1-09). Now residences get the same federal tax credits that business do.  You get a 30% federal tax credit on the cost of your system.  If you can’t use all of the tax credit this year you can carry it forward to future years to keep eliminating your federal taxes.

State Incentives

Louisiana still says they will give you a 50% refundable tax credit on each residential system you purchase, up to $10,000 per system. As of July 1, 2015

you may receive a maximum one-time refundable credit of $10,000 on your solar electric (PV) system, or $2.00 a watt, whichever is less.   If you need a larger system than $20,000 then you just get the $10,000 tax credit from the state, but get 30% of any amount from the Federal tax credit.  The only problem is the 2015 legislature put a cap of $10M each year, first come first served.  There is a strong possibility we are passed that limit, but we are waiting on official totals from the Department of Revenue.   If you look at the Real Value of solar and the rising utility rates you will want your own solar power system now!**

How much will I pay?

If your system costs $20,000 before tax credits, then the net will be $4000. We provide a 12 month, same as cash loan so you can OWN YOUR SYSTEM AND GET YOUR TAX CREDITS with no money down.  In Louisiana, this is the best way to go.

Cost of system                            $20,000*

50% State Tax Credit               ($10,000)  - first come, first served!

30% Federal Tax Credit            ($6,000)

You pay                                              $4,000**

*This is an approximation of cost and will vary by the system that you select.  (We offer Financing with no money out of pocket for a year – call us!)  State tax credits are refundable – less what you owe in state taxes. Like all tax refunds, solar tax credit refunds are considered taxable income by the Federal Tax Commission. 

**Please also check with your CPA on your individual tax situation.

Business Tax Credits

You get the 30% Federal Tax credit through 2016 so don’t put off your system any longer.  When you include your depreciation schedules it make going solar an even more profitable endeavor. Have your CPA look into the MACRS depreciation schedules and you will be amazed at how affordable and profitable it is to install a PV solar electric system at your business.

Want more information?

Check out the resources we have gathered for you below. Also, make sure to consult your CPA about your individual tax situation.

Category: Credit

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