Learn All About Solar Tax Credits & Rebates for Your Texas Property

First things first, you may be wondering how to claim solar tax credit. The process is quite simple. All you’ll have to do is file the IRS Form 5695 as a part of your tax return. You’ll have to calculate the credit on Part 1 of that solar tax credit form and enter the result on your 1040.

Here’s some more important terms to know when it comes to solar tax credits, incentives, and rebates in Texas: 

• Federal Solar Investment Tax Credit: The ITC is a 26%federal credit that is available for Texas home solar systems that are installed by the end of 2022. You can also take advantage of a solar tax credit extension, which has that rate at 22% through 2023.
• TXU Energy Renewable Buyback Plan: This allows you to earn bill credits when you produce more clean energy than your home uses. That said, if you don’t produce enough, you will pay a flat rate for solar power from the grid in Texas.
• Solar Energy System Property Tax Exemption: This tax exemption lets homeowners and businesses exclude the added value of a solar energy system from the valuation of their property, which can be incredibly for taxation purposes.
• Local Utility Company Solar Rebates: These rebates reduce the up-front cost of solar and the cost after installation. Some examples include the American Electric Power (AEP) rebate, CPS Energy Solar rebate, and the Oncor Solar rebate.