Solar tax credit

[Cathi]

Originally Posted by cpaharley2008

According to Internal Revenue Bulletin: 2013-47, the credit is only on your principal residence, not a second home, nor a vacation home. In addition you must reduce your basis in such property and recapture as a gain upon disposition that portion upon which the credit was claimed.

Yes, the form says it is for the main home only and cautions that you only have one main home. So only full-timers need apply.

[Pam Garlow]

Nice basic information here. And much more out on the web
How to Choose Portable Solar Panels for Camping.


And lots of info on You Tube

https://www.youtube.com/watch?v=G8YcFNGauoY

[gordon2]

Originally Posted by cpaharley2008

According to Internal Revenue Bulletin: 2013-47, the credit is only on your principal residence, not a second home, nor a vacation home. In addition you must reduce your basis in such property and recapture as a gain upon disposition that portion upon which the credit was claimed.

I believe you have misread the IRS information. The following is my take on the solar credit for RVs and Campers. Do NOT take my word for it as I am not a tax professional. I will be employing a tax professional when I apply for this credit and you should do the same.

The section 25-C credit is limited to one's primary residence but the 25-D credit for solar power is not.

An excerpt from this IRS publication follows (with my highlighting):

Q-6: Are the credits available for improvements made to a second home (for example, a vacation home or an investment property)?

A-6: Improvements made to a second home are not eligible for the credit under § 25C. Section 25C(c) and (d) require qualified energy efficiency improvements and residential energy property to be installed in or on a dwelling unit owned and used by the taxpayer as the taxpayer’s principal residence (within the meaning of § 121).

With respect to the credit under § 25D, fuel cell property credits are not available for second homes. Section 25D(d)(3) requires fuel cell property to be installed on or in connection with a dwelling unit that is used as the taxpayer’s principal residence (within the meaning of § 121). However, a taxpayer may claim a § 25D credit for other qualifying properties described in § 25D that are not fuel cell properties (solar electric property, solar water heating property, small wind energy property, and geothermal heat pump property) installed in or on a dwelling unit used as a second home or a vacation home by the taxpayer. But a taxpayer may not claim the § 25D credit for expenditures for improvements made to an investment property, such as rental property, that is not also used as a residence by the taxpayer.

-- End quote --

Other resources support the conclusion that a tax credit for solar engergy is available when installed on a second home. A few of these are:

1. This IRS article which states (my emphasis):

[The] tax credit is 30 percent of the cost of alternative energy equipment installed on or in your home.
Qualified equipment includes solar hot water heaters, solar electric equipment and wind turbines.
There is no dollar limit on the credit for most types of property. If your credit is more than the tax you owe, you can carry forward the unused portion of this credit to next year’s tax return.
The home must be in the U.S. It does not have to be your main home.
This credit is available through 2016.

2. Page 16 of this report.


Note there may be other requirements and hurdles to overcome to get this credit. For example, the previously linked report states that:

the system must be certified by the Solar Rating and Certification Corporation (SRCC) or a comparable entity endorsed by the government or the state in which the property is installed.

Also the credit is available for systems installed through the end of 2016. There may be additional credits available at the State level. Some states exempt solar power equipment from property tax value.

The IRS says that:
A home includes a house, condominium, cooperative, mobile home, house trailer, boat, or similar property that has sleeping, cooking, and toilet facilities.
- - - - - - - - -

As this is a rather complicated subject (as it has to be since the IRS runs it), I would be most interested in hearing the details from people who have added solar power to their trailers or other RVs and received the 30% tax credit.

[cpaharley2008]

The entire US Tax Code is open to interpretation, on purpose, that is how tax accountants and tax lawyers make their living. What the courts will use in their decision making is another level of interpretation. All of these decisions will cost $$$$ as will the record keeping and certifications. Good luck...

[Jim Bennett]

Originally Posted by cpaharley2008

The entire US Tax Code is open to interpretation, on purpose, that is how tax accountants and tax lawyers make their living. What the courts will use in their decision making is another level of interpretation. All of these decisions will cost $$$$ as will the record keeping and certifications. Good luck...

Provided you with gainful employment, eh?

[cpaharley2008]

and retirement....

[steve dunham]

When I purchased the solar system for my trailer, the only purpose was to allow me to camp off grid.
A tax credit never entered the picture and still doesn't.

[gordon2]

Originally Posted by steve dunham

When I purchased the solar system for my trailer, the only purpose was to allow me to camp off grid.
A tax credit never entered the picture and still doesn't.

Well it seems the last few posters either don't want free money, or think its not worth the effort to get it.

I agree it should not be the primary driving factor in the decision to add solar, and that the tax code is FUBARed beyond belief. But it is what it is, so I say get the tax credits you are legally entitled to. Unless of course you think the US Government will make better use of your money.

I'm still waiting for someone with real world experience in claiming the credit to chime in.

[WaltP]

Originally Posted by gordon2

I'm still waiting for someone with real world experience in claiming the credit to chime in.

Well, that seems like a pretty clear message to me.

Walt

[cpaharley2008]

Originally Posted by gordon2

Well it seems the last few posters either don't want free money, or think its not worth the effort to get it.

I agree it should not be the primary driving factor in the decision to add solar, and that the tax code is FUBARed beyond belief. But it is what it is, so I say get the tax credits you are legally entitled to. Unless of course you think the US Government will make better use of your money.

I'm still waiting for someone with real world experience in claiming the credit to chime in.

It is not free money as the intent of the credit was to promote green technology, certainly towing your credit behind you is not that green.

[honda03842]

I took the credit with our first solar panels. They were homemade. It went through without question.

For a trailer a solar panel is great, for a nation solar does little except increase energy costs. The credit helps pay for the increased energy costs we face because of the cost of building fields of solar panels.

[steve dunham]

When I purchased my portable solar system, I was led to believe that since the system was not permanently attached to my trailer /structure it did not qualify for the tax credit. That being said , I believe the intent of the law was to encourage green technology not to allow me to go camping off grid. Secondly it's not that I don't like free money it's that there is no such thing as free money in my book. Having a travel trailer is a luxury not a necessity and luxuries should not be subsidized by the goverment. IMHO

[cpaharley2008]

Well said, Steven....no such thing as a free lunch.

[Jim Bennett]

Just a reminder to please keep this thread from getting political. It is one thing to discuss a given tax credit, but opinions on government always lead to chaos for us.

[WaltP]

Thanks Jim.

[floyd]

Originally Posted by steve dunham

When I purchased the solar system for my trailer, the only purpose was to allow me to camp off grid.
A tax credit never entered the picture and still doesn't.

Forget the solar system.... Over the years I have purchased several Galaxies... Talk about OFF THE GRID! (DON"T PANIC! Just ask Ford Prefect)

[Raz]

Originally Posted by floyd

Forget the solar system.... Over the years I have purchased several Galaxies... talk about OFF THE GRID!

For heavens sake Floyd answer the question , did you take the tax credit? Raz

[gordon2]

After studying the IRS form and instructions, I see no obstacles to claiming the tax credit for Solar Electric equipment (and cost of the labor to install it) that is used at a second home. Furthermore, an RV or trailer with kitchen, bath and sleeping facilities does qualify as a (usually second) home (as long as you actually live in it at times, its not a business property, etc.). Disclaimer: I am not a tax professional and you should not take this as advice or counsel, but instead only my opinion, and offered only for discussion.

The requirement for certification by the Solar Rating and Certification Corporation (SRCC) or a comparable entity, that I mentioned in post 43, is listed in the IRS instructions for Solar Water Heating, but not for Solar Electric, so on second look, I believe that said certification is not required for a solar cell / electric setup. (Note that geothermal heat pumps need to meet the requirements of the Energy Star program and fuel cells also have an efficiency requirement)

The question arises, does the solar equipment need to be permanently installed, or do portable panels also qualify? The IRS instructions state:

Qualified solar electric property costs are costs for property that uses solar energy to generate electricity for use in your home located in the United States. (Non-pertinent verbiage deleted.) The home does not have to be your main home.

Nowhere in the instructions do I see a requirement that the equipment be permanently affixed or installed, only that it is used to generate electricity for the home. One manufacturer issues an eligibility certificate for their portable units as long as the portable unit is used “...in or in connection with a qualifying dwelling unit.” I would even argue that a portable unit that is used for powering my part time residence (known as a Scamp trailer) is even more qualified for the tax credit if I also use it at my main home for charging my cell phone or the like.

My solar unit will allow me to be off grid more often, and that translates to less use of shore power which is consistent with the intent of the tax credit. It also helps to stimulate R&D in the field which I believe is also an objective of the financial incentive. I will admit however that when I got my Economic Stimulus check in 2008, I did not use it to stimulate the economy. Instead I put the money in the bank. I am philosophically opposed to using the tax code for social engineering and I guess I don’t care what the intent of the tax rebates or credits are as long as I legally qualify for them. That qualification was the focus of my postings.

[floyd]

Originally Posted by P. Raz

For heavens sake Floyd answer the question , did you take the tax credit? Raz

My answer is... (depending on what your definition of is is...)
I have never itemized on my taxes and have never used solar panels to produce electricity.(except for my nifty little hand held calculator)
.

[Raz]

Originally Posted by floyd

My answer is... (depending on what your definition of is is...)
I have never itemized on my taxes and have never used solar panels to produce electricity.(except for my nifty little hand held calculator)
.

No Floyd, the Galaxy tax credit..... Free money. For heaven sake