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However, taxpayers must be careful that they can demonstrate that 100 percent of the energy used by the battery is derived from a solar source.
Are you certain? I thought a battery backup system without any solar recharging was eligible.
Are you certain? I thought a battery backup system without any solar recharging was eligible.
i copied that directly from the internet.....
it sounds like the battery needs to be charged by solar.....may need to do more research on the specifics....
in my situation the off grid battery has no connection to the grid what so ever and is solely being charged by the solar PV panels.....so it is 100 percent from a solar source...
i will see if i can find that source again....the below statement....
However, taxpayers must be careful that they can demonstrate that 100 percent of the energy used by the battery is derived from a solar source.
(2) Qualified solar electric property expenditure
The term ‘‘qualified solar electric property
expenditure’’ means an expenditure for property
which uses solar energy to generate electricity
for use in a dwelling unit located in the
United States and used as a residence by the
taxpayer.
the ITC (investment tax credit aka federal solar tax credit) is available for residence that you live in and the battery qualifies if charged by solar....and is 30 percent tax credit for tax year 2022 through 2034..... according to when the equipment is installed....there is a 5 year carry forward of the tax credit if you do not owe much federal tax....
somewhere in another place it said 100 percent charged by solar.....don't quote me >>>> probably need to talk with a cpa or question the irs directly for the most up to date answer and correct answer....but if you find the specific answer please share as I am also interested and researching this topic as are others i am sure....
§25D. Residential energy efficient property (a) Allowance of credit In the case of an individual, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to the sum of the applicable percentages of— (1) the qualified solar electric property expenditures, (2) the qualified solar water heating property expenditures, (3) the qualified fuel cell property expenditures, (4) the qualified small wind energy property expenditures, (5) the qualified geothermal heat pump property expenditures, and (6) the qualified biomass fuel property expenditures, and made by the taxpayer during such year.
The Residential Clean Energy Credit provides a 30 percent tax credit to lower the installation cost of residential clean energy, including rooftop solar, wind, geothermal, and battery storage. The credit steps down to 22 percent by 2034. The Residential Clean Energy Credit offers more households access to and freedom to choose renewable energy that can lower monthly energy bills and cut air pollution from power plants.
I still believe it must be charged by solar or possibly wind for the battery (ESS) to qualify for the 30 percent federal tax credit....
where is the tax expert when you need him/her...🤔
I am looking at it from the solar PV charging the battery to make the investment in the LIFePO4 battery more economical with the 30 percent federal tax credit at my residence...as i am strictly off grid in my solar builds...
chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/ https://www.nrel.gov/docs/fy18osti/70384.pdf
the nrel bulletin describes how the battery if charged by pv is given the credit fairly clearly....
it shows there is no credit if there is no PV system....but can write the battery off under MACRS on a 7 year write off....so definitely want to charge your battery with solar PV...to get the 30 percent federal tax credit...
I just searched for "ess and the federal tax credit" and then >>>> the nrel bulletin explains it best....
nrel = national renewable energy laboratory
I was not able to copy it but I am sure their is a way...
my sledge hammer will fix most computer woes!!!!! 😎
inflation reduction act >>>> a trillion dollar plus pork barrel bill which will undoubtedly increase taxes for future generations in many yet to be seen ways...
creative cover up naming of their legislative unreadable bill for the average person some 4000 pages of gibberish.
sorry about my interpretation of the new legislation's name....😎
New Standalone Storage ITC
Although the federal ITC has always been available for solar power and battery backup systems, the Inflation Reduction Act introduces a new tax credit for standalone electricity storage. At up to 30% of an Energy Storage System’s (ESS) total cost until the end of 2033, homeowners can qualify for tax credits on residential, standalone batteries with a capacity of 3 kWh and more beginning on January 1, 2023.
The above was copied from enphase.com >>> to confuse my understanding a bit more>>> at any rate >>> you will need to do more research and contact a tax advisor/CPA or specifically ask the IRS for the best answer about standalone battery ESS not charged by solar power ???? but the above seems to complicate the answer....
In my situation I only use solar PV to charge the LiFePO4 batteries in my off grid solar builds, so it definitely qualifies for the residential home owner 30 percent federal tax credit....
As a side note to my reading/research >>>> I do note they also have incentives for heat pumps so that would be a good electrical addition to the off grid solar projects...
(6) Qualified battery storage technology expenditure
The term "qualified battery storage technology expenditure" means an expenditure for battery storage technology which-
(A) is installed in connection with a dwelling unit located in the United States and used as a residence by the taxpayer, and
(B) has a capacity of not less than 3 kilowatt hours.
As far as I can tell, the stand-alone 30% battery credit doesn't apply until 2023:
Statutory Notes and Related Subsidiaries
Effective Date of 2022 Amendment
Pub. L. 117–169, title I, §13302(d), Aug. 16, 2022, 136 Stat. 1947 , provided that:
"(1) In general.-Except as provided in paragraph (2), the amendments made by this section [amending this section] shall apply to expenditures made after December 31, 2021.
"(2) Residential clean energy credit for battery storage technology; certain expenditures disallowed.-The amendments made by subsection (b) [amending this section] shall apply to expenditures made after December 31, 2022."
Link:
if it is charged by solar then the 30 percent federal tax credit is retroactive to January 1st, 2022....for the batteries and solar panels and associated equipment....if all is powered and charged by solar PV....
this is the route I am going with all my off grid solar installations....
I personally have no stand alone batteries,,,,all are charged by solar PV....
I do not utilize any wind power at the moment and I kind of like the solar PV with less moving parts to deal with....
the wind has been killer force lately and definitely dictates what I do outside in the north country (((( darn cold wind chills >>> it was up to 4 degrees Fahrenheit yesterday and the sun was out but wind chill bites right through my gloves and says get back to the inside for safety....wind chill was like 50 below or some darn number))))
the tax credit can be carried forward up to 5 years if you do not owe uncle sam much tax in 2022 etc...
At any rate Merry Christmas to all and be safe out there....😎
more South Dakota snow now.... but 16 degrees Fahrenheit >>> so a heat wave compared to 10 degrees below zero Fahrenheit....may get above freezing Tuesday or Wednesday. I can certainly hope so...
good weather to cook inside, and do inside maintenance things >>> out of the cold as much as possible ...
now we know why bears hibernate 1st hand....
It's -14f today. Compared to the -40f a couple days ago, it's smoker weather.
Ugh, tax law...
Fairly good overview here: https://www.nrel.gov/docs/fy18osti/70384.pdf (The document is old, but the ITC mentioned here is apparently what was extended for 10 more years...)
But it sounds like the only thing new is that it applies to standalone BESS. So now the credit is no longer contingent on solar? How sad ... but it applies to a friend of mine, so he'll be happy to hear it.
On the other hand, i need to add 20kWh... that 30% will be a pretty penny -- might just put a 12K on the menu.