Solar, Geothermal, and Electric Vehicle Tax Credits
Joel Zook, Energy Planner
Below is an overview of 2019 tax credits that may help make your next solar, geothermal, or electric vehicle purchase possible.
If you haven’t already heard 2019 is the last year for the full 30% federal tax credit on solar. The credit declines next year to 26% and 22% in 2021. Those are still generous discounts on a solar system but waiting a year to install will add an estimated 6 months to the payback time to a typical residential array. If you’re on the fence, we recommend getting a solar site assessment from the Energy District. Joel Zook can give you a detailed report on recommended sizing, production of a recommended system, including shading analysis and a financial picture of how your system will perform. Give him a call at 563-380-7137 to schedule an appointment or email email@example.com.
Really though, local contractors are busy. If you think you’d like to install solar this year, you’d better get on their schedule quickly. Check out our list of local solar installers and Energy District members
Check out our Solar Resources page for more info, or get in touch.
Residential Geothermal systems also begin their tax credit phase-out in 2019, on the same structure as solar. See more on the Iowa Geothermal Association fact page.
Commercial geothermal systems are also eligible for a 10% federal tax credit, but not for any state tax credits. However, businesses are able to take advantage of either the Modified Accelerated Cost Recovery (MARC) depreciation or section 179 expenses to reduce both their federal and state taxable income. The 10% federal tax credit for commercial geothermal systems is set to expire at the end of 2021.
Two of the leading EV manufacturers, Tesla and General Motors, have produced enough EVs to trigger the phase-out of their tax credits. Tesla met the 200,000 vehicle mark first in July 2018. Tesla fans have until the end of the year to claim the reduced tax credit of $1,875. GM was about 3 months behind Tesla when it produced its 200,000th vehicle. New GM EVs are eligible for a $3,750 tax credit through the end of September, after which its tax credit will also drop to $1,875. The smaller tax credit amount is good for GM vehicles through March 2020.
Check out this article from InsideEVs for more.
Nissan, Toyota, and other manufacturers do not appear to be close to reaching their 200,000th EV so full tax credits are available (up to $7,500) for EVs from these manufacturers.