Does it seem like everyone except you has already installed residential solar panels on their Arizona homes?
While that’s not quite true, it’s easy to see why you may have that impression. In 2019, Arizona ranked third among all states in the number of solar installations, according to data compiled by the SEIA. It makes sense, given how much sunshine is available to homeowners looking to cut down on their electricity bills with clean, renewable energy.
There was a big solar push in 2019 centered around homeowners’ last opportunity to qualify for the full federal solar tax credit. But with 2019 behind us, does that mean there are no solar incentives or solar tax credits in 2020? Are solar panels worth the investment in 2020 and beyond?
The answer is yes! There are still incredible savings and discounts available to homeowners interested in going solar for the new decade and taking advantage of the federal solar tax credit. Let’s take a look at what the solar tax credit is, and how it’s changed this year.
What’s Happening in Arizona to the Solar Tax Credit in 2020?
The federal solar tax credit, also known as the investment tax credit (ITC), was originally established in 2005, and due to its popularity was extended through 2021. Through the federal solar tax credit, homeowners can qualify for a tax credit towards your federal taxes due, offsetting a percentage of the total cost of solar panel installation for your home.
2019 was the last year that homeowners could receive the full 30% credit—starting in 2020, the residential credit has stepped down to 26%. In 2021, the credit will step down again, this time to 22%, and in 2022 the credit will be eliminated completely for residential solar projects (while commercial solar installations will qualify for a permanent 10% tax credit).
So, yes, the tax credit for homeowners is no longer the full 30%. However, 26% still represents a significant savings for people and families weighing the upfront investment of solar installation.
For example, let’s say the cost to purchase solar panels in Arizona is roughly $16,000 for a 6kW system. A 26% federal tax credit would save you an additional $4,160, reducing your total to only $11,840.
How Can I Qualify for Local Arizona Solar Incentives in 2020?
But the federal solar tax credit isn’t the only solar incentive in Arizona available to homeowners. A residential Arizona solar credit will save homeowners up to an additional $1,000 on your state income taxes as well. With those savings, homeowners are now looking at a cost of right around $10,000 to upgrade to solar.
There are other Arizona solar power incentives and financing options as well, including solar property tax incentives, solar sales tax incentives, and more.
Plus, after the few years that it will take you to pay off your investment, you’ll be ready to benefit from as much as 20 years of reduced (or even eliminated) monthly electric bills, plus the added benefits of solar power like:
Increased home value
Protection against utility rate hikes
Low maintenance costs
Reduced carbon footprint
Energy Solution Providers: Solar Solutions for AZ Homes
As a leading Arizona solar installer, we take pride in the energy savings that homeowners are able to realize when they upgrade their home to solar energy. Don’t rely on an online solar savings estimator or calculator when making such an important decision for your home. At Energy Solution Providers, we’ll take the time to review the actual numbers and details unique to your home and property to give you a realistic cost estimate, as well as inform you of the incentives and solar financing in Arizona you could use to maximize your upgrade.
Start the decade off right with the significant savings available with solar installation in 2020. Call 520-868-0700 or contact us to learn more.