Does Arizona Give Credit For Solar Panels

How does the 26 federal solar tax credit work.

Does arizona give credit for solar panels. Credit for solar energy devices a nonrefundable individual tax credit for an individual who installs a solar energy device in taxpayer s residence located in arizona. Therefore you aren t required to pay any sales tax on the purchase of your solar system. Every resident in arizona who installs solar panels gets a state tax credit of 25 of the total system cost up to 1000 to be used toward state income taxes. This puts the average cost of a 5kw system at 13 958 before incentives and 9 325 after claiming incentives.

Thanks to the solar equipment sales tax exemption you are free from the burden of any arizona solar tax. Equipment and property tax exemptions. Arizona offers state solar tax credits 25 of the total system cost up to 1000. Given a solar panel system size of 5 kilowatts kw an average solar installation in arizona ranges in cost from 11 432 to 15 468 with the average gross price for solar in arizona coming in at 13 450.

As of september 2020 the average solar panel cost in arizona is 2 69 w. As a credit you take the amount directly off your tax payment rather than as a deduction from your taxable income. The most significant solar rebate offered in arizona is the credit for solar energy devices from the arizona department of revenue. You can claim the credit for your primary residence vacation home and for either an existing structure or new construction.

Arizona state tax credit for solar. If the credit exceeds the taxes you owe you can continue to carry it over for up to five years. Residential arizona solar tax credit. Residential solar energy credit arizona home solar system owners are eligible for a credit worth 25 of their system cost or up to 1 000 whichever is less.

After accounting for the 26 federal investment tax credit itc and other state and local solar incentives the net price you ll pay for solar can fall by thousands of dollars. This tax credit is capped at 1 000 but the good news is that it can be combined with the 30 federal solar tax credit. There s no cap on the federal tax credit and it can be claimed over multiple years if necessary. This credit offers 25 off the gross cost of the system up to a maximum credit of 1 000.

And of course you arizonans also benefit from the 26 federal solar tax credit as well. After claiming the 26 federal solar tax credit and arizona s state tax credit the price is only 2 00 per watt.