Should I go solar?

[HX_Guy]

Yes, I mentioned retirees as well. But most people are not retirees. A great solution for retirees is a pre-paid lease, the tax credit gets taken off the top as a discount off the system.

Financial stake or not, I still think solar is one of the best thing people can do. I did it prior to owing a solar company.

[AzScorpion12]

Originally Posted by jimj

Most of the people I know get a refund at the end of the year and if they claimed 0 would get an even bigger refund as more taxes would be taken out so the credit would do noting for them except lower their monthly take home pay.
What they'd have to do is claim 5-10 deductions (decrease withholding) but that's risky as it'd be lying to the IRS wouldn't it?
It's much easier to manage if you're self employed but most are not in that position.

That's what I had meant to say but the brain wasn't working right that morning.

Originally Posted by jimj

Post #26, quote from a tax professional discussing a solar system that cost $20k and the tax credit. So, I'm getting my info from tax pros and you? Look, I get that there are those who have a financial stake in home solar and I'm sympathetic, I really am. I'm also for people getting the upsides as well as the downsides that have and do exist in today's market.

I've had many CPA's do my taxes over the years and trust me just because their a "tax professional" doesn't mean they know everything. Yes my circumstances are the most beneficial being self employed as I just skip 1-2 quarterly payments but like HX explained you will still get a solar tax credit and it is carried out over a 5 year period. Also,I have no financial stake in this I'm just super happy with my system and I see a lot of misinformation given out on a lot of different message boards. I'd hate to see someone who really wants solar and doesn't get grandfathered in now then learn later once it's to late they were misinformed and have now missed the boat.

[jimj]

Originally Posted by Gixxer1K

That's what I had meant to say but the brain wasn't working right that morning.





I've had many CPA's do my taxes over the years and trust me just because their a "tax professional" doesn't mean they know everything. Yes my circumstances are the most beneficial being self employed as I just skip 1-2 quarterly payments but like HX explained you will still get a solar tax credit and it is carried out over a 5 year period. Also,I have no financial stake in this I'm just super happy with my system and I see a lot of misinformation given out on a lot of different message boards. I'd hate to see someone who really wants solar and doesn't get grandfathered in now then learn later once it's to late they were misinformed and have now missed the boat.

Well, some of the information I picked up from TurboTax which has quite a good article on solar credits and further reading from other sites including the IRS that discuss the non refundable status of said credit. I don't put a lot of stock in what any solar company puts out as the truth for obvious reasons.

As I understand it the tax liability on $40k is about $2100 or less and on $50k it's about $3300 or less dependent on deductions.
Given those scenarios the ROI on just the credit alone is at a minimum 10 years, probably more. That is NOT a great deal in my opinion as you're paying upfront and waiting years to get it back if at all as tax policy can and does change.

I am not sure you can still collect after you sell the system (house).

[HX_Guy]

And on a related note...

Added 11 more panels (3.11 kW, bringing system size 15.51kW) to to my home solar system to charge the car, additional panels should produce an additional 5,175kWh which is roughly 17,000 miles per year of driving (I may be a little optimistic here, that's at 300Wh/ mile..but even at 350Wh/mile, that would get me about 15,000 miles.

Used a new product we've been using for the past couple months called E-Curb. Pretty amazing stuff, forms a solid rubber seal around the penetrations.

[AZ Manager]

Originally Posted by Gixxer1K

That's what I had meant to say but the brain wasn't working right that morning.

I've had many CPA's do my taxes over the years and trust me just because their a "tax professional" doesn't mean they know everything. Yes my circumstances are the most beneficial being self employed as I just skip 1-2 quarterly payments but like HX explained you will still get a solar tax credit and it is carried out over a 5 year period. Also,I have no financial stake in this I'm just super happy with my system and I see a lot of misinformation given out on a lot of different message boards. I'd hate to see someone who really wants solar and doesn't get grandfathered in now then learn later once it's to late they were misinformed and have now missed the boat.

That wouldn't actually change your tax liability except you would be paying underpayment penalties for no reason.

Originally Posted by HX_Guy

And on a related note...

Added 11 more panels (3.11 kW, bringing system size 15.51kW) to to my home solar system to charge the car, additional panels should produce an additional 5,175kWh which is roughly 17,000 miles per year of driving (I may be a little optimistic here, that's at 300Wh/ mile..but even at 350Wh/mile, that would get me about 15,000 miles.

Used a new product we've been using for the past couple months called E-Curb. Pretty amazing stuff, forms a solid rubber seal around the penetrations.

I never did get a quote from you.

Originally Posted by jimj

Well, some of the information I picked up from TurboTax which has quite a good article on solar credits and further reading from other sites including the IRS that discuss the non refundable status of said credit. I don't put a lot of stock in what any solar company puts out as the truth for obvious reasons.

As I understand it the tax liability on $40k is about $2100 or less and on $50k it's about $3300 or less dependent on deductions.
Given those scenarios the ROI on just the credit alone is at a minimum 10 years, probably more. That is NOT a great deal in my opinion as you're paying upfront and waiting years to get it back if at all as tax policy can and does change.

I am not sure you can still collect after you sell the system (house).

2017 tax liability for a single person on $40k taxable income is $7,137.50. That is $932.50 from the 10% bracket, $5692.50 from the 15% bracket, and $512.50 from the 25% bracket. Same person on $50k taxable income you are at $9,637.50 with the last bracket jumping to $3,012.50. For a married couple $40k taxable income your tax liability is $5,067.50 and at $50k that jumps to $6,567.50. That is all taxable income so after all deductions (deductions reduce your taxable income) but before any credits (credits reduce your tax liability but never below $0), this program is a credit, and before any refundable credits (which can reduce your tax liability below $0).

My father who is 59 and files single taking the standard deduction with $41k in income gets the standard deduction of $5,600 has a tax liability of about $4300. The program allows you to spread the credit over 3 years, and maybe more but the tax form allows 3 years for sure. That would mean over 3 years my father with $41k income could get a system in the $43,000 with a total credit of $12,900 at 30% and still claim the full credit... eventually.

My wife and I have very complicated taxes so I've got loads of room to claim the full credit on a reasonable sized/priced system.

[AzScorpion12]

Originally Posted by AZ Manager

That wouldn't actually change your tax liability except you would be paying underpayment penalties for no reason.

The underpayment penalties aren't that much. This was the first year in over 30 years I didn't pay in any quarters and the total penalty was $400. I had also asked my accountant a while back when I first thought about getting solar what's the easiest way for me to have a tax liability so I could use all my solar tax credits in 1 year and it was to skip a few quarterly payments. I just had mine done yesterday and wrote off the full 5K for Fed and the full 1K for state with only having to pay $400 for missing all 4 quarters of 2016.