Home Battery Tax Credit?
Breaking news on Friday, March 2, 2018: the Internal Revenue Service (IRS) indicated a Home Battery Tax Credit based on inquiries from taxpayers. The ruling (released through a private letter), states that a homeowner with an existing home solar array is eligible for the home battery tax credit when they buy and install a home battery storage system that is charged completely by a solar panel system. This means that a storage system may qualify for the 30% federal investment tax credit (ITC) only if it is charged 100% by the solar array—specifically, as long as it “meets the definition of a ‘qualified solar electric property expenditure’ under § 25D(d)(2) of the Code, and therefore, you may claim a tax credit on this battery.”
Although the private letter ruling was issued to a single taxpayer and applies only to that specific case, it tells accountants everywhere how the agency is interpreting the tax law. In this case, taxpayers can now take the tax credit when adding home batteries to an existing solar setup, even if they claimed the tax credit when they set up their grid-tied panels, as long as the battery receives power only from the home’s solar panels and not from the grid.
Solar-Plus-Home Battery Storage Milestone
Adding home battery storage to residential solar systems remains an expensive proposition. However, the ruling marks a milestone for the residential storage industry, allowing the tax credit to put a dent in the cost. “The 30% credit is like jumping ahead five years on the cost curve for home battery systems—so on that count, customers will be able to afford longer-duration systems sooner and present greater opportunity for self-reliance.” Says Kelly Speakes-Backman, CEO of Energy Storage Association.
Home battery storage is an opportunity to cushion against demand charges. It is certainly critical to helping homeowners manage their electric bills and to ensure uninterrupted service after storms and other common sources of outages. Whether or not you are on the grid, the home battery system paired with solar definitely puts more power into your own hands.
Helio Energy Solutions is now a certified Kohler Generator Dealer. We are authorized to sell, install and service home battery storage from one of the most trusted and recognized brands in the world. Our customers can now feel confident that their purchases will protect their homes and families.