April 6, 2022 | By RGR Marketing Blog

Understanding the 2022 Federal Solar Investment Credit

Buy Solar LeadsFor many people who are on the fence about whether to go solar, cost is often one of the biggest hurdles keeping them from making their decision. After all, despite solar’s cost dropping significantly over the last decade, a standard sized system still costs anywhere from $15,000 and $25,000 depending on where it is installed and what type of panels are purchased.

When faced with such numbers, you can see how some homeowners might lose their excitement about all the benefits solar provides. Therefore, you need to make sure they understand all the different financing options available to them that can help make going solar less impactful on their budgets. In addition, you also need to let them know about the Federal Solar Investment Credit (ITC) and why putting their solar installation off until 2023 or later could wind up costing them thousands more.

Why Is 2022 the Year to Go Solar?

Throughout 2022, residential and commercial properties that install solar energy systems will be eligible for a Federal Solar Investment Credit equal to 26 percent of the amount invested. To qualify, the construction needs to begin before January 1, 2023. This is a dollar-for-dollar tax credit, so if the system being installed costs $20,000, then the tax credit would be $5,200. This reduces the overall cost of the system to $14,800.

On the other hand, if the prospect waits until 2023 to install solar, then their ITC drops to 22 percent. In the case of the same installation as above, the tax credit would fall to $4,400 and the total cost of the system would be $15,600.

Worse yet would be for the prospect to wait until 2024 to have their solar system installed because as of January 1, 2024, the ITC is scheduled to be phased out completely. This means the total cost of the system would remain $20,000.

Will the ITC Be Extended?

While the ITC is set to expire at the end of 2023, that doesn’t mean that it will go away forever. The tax credit was previously set to expire at the end of 2020, but Congress passed the extension to keep it alive until 2024.

Could this happen again? Possibly, but there is no knowing whether it will happen or not, especially with 2022’s elections. For example, should Republicans regain control of the Senate or House, then the odds are greater for any extension of the ITC being scrapped as many members of that party are aligned with the fossil fuel industry.

Purchasing vs Leasing Solar Panels and ITC Eligibility

Another important thing that your prospects need to know about the ITC is that they can only be eligible for the tax credit if they purchase their solar panels. If they choose to lease the panels or use a solar power purchase agreement, then they will not qualify for the Federal Solar Investment Credit.

Start Converting Leads Now, So They Can Save More with the ITC

The 2022 Federal Solar Investment Credit is the highest it’s ever been, so if you have prospects weighing their solar purchase, then they need to know that this benefit may not be available if they don’t act now. Remember, the credit is only available to clients who purchase their systems and start installation in 2022. Waiting until 2023 will result in less savings and waiting until 2024 will result in no savings at all, based on the current ITC step-down schedule.

This means you need to start converting solar leads now! At RGR Marketing, you can take advantage of our 20-plus years of experience serving the solar industry and get the leads you need to keep your installation calendar filled this year. Our solar leads are exclusive and contain contact information for homeowners who have shown recent increased interest in solar. And they are scrubbed, verified, and easily integrated into any lead management software platform.

Contact RGR Marketing today to get access to the high-quality solar leads you need to stay ahead of the competition in 2022.

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