For those considering purchasing new solar hot water systems, waiting until 2006 can generate some take breaks. For those that purchase new solar photovoltaic and/or hot water systems after January 1, 2006 and before December 31, 2007 the following tax credits to individuals for residential solar energy systems are available:
The allowable tax credit is 30% of the qualified solar system expenditures up to a maximum tax credit limitation of $2,000.
For solar photovoltaic (PV) systems, the allowable tax credit is 30% of the qualified PV system expenditures up to a maximum tax credit limitation of $2,000.
In order for the solar hot water system to be eligible for the tax credit, the system must be certified by the Solar Rating and Certification Corporation (SRCC). It must also produce a minimum of 50% of the hot water needed by the residence.
There is no specific qualification provided for PV systems. You may be able to claim tax credits for either or both types of solar systems.