Updated: Nov 4, 2019
2019 Solar Investment Tax Deadline: What You Need To Know
The 30% investment tax credit for going solar drops in value after 2019.It’s not enough to buy the system before the end of the year. To claim the credit, your system must be fully installed.Solar systems take weeks to design, ship and install – so now is the time to start if you want to meet the deadline.
2019 is the last year to claim the full 30% investment tax credit for going solar.
The tax credit is a major incentive that puts money back in your pocket when you file your taxes. If you install the system before the end of 2019, you should be eligible to claim the full credit.
But if you wait until after 2019, you’ll get less money back from the credit, which ultimately means you’ll spend more money when you do decide to go solar.
To help you get as much value as possible out of your switch to solar, we put together a quick update on the tax credit changes to tell you exactly what you need to do to complete your project before the deadline hits.
As you’ll see, going solar is a long and involved process. You’ll need to leave enough time to design your system, file a permit, ship the equipment, and build the system—all before the December 31st deadline.
If you’re looking to take advantage of the full 30% credit, we urge you to get started now so the project doesn’t drag on and cause you to miss the cutoff date.
This article assumes you’ve been considering going solar and are generally familiar with the solar tax credit. If this is all new to you, check out our simple introduction to the topic:
2019 Deadline To Claim the Federal Tax Credit
The deadline to claim the full 30% solar tax credit is December 31st, 2019.
But what needs to be done before the deadline to be eligible?
It turns out the requirements are slightly different for residential and commercial installations.
Residential systems must be fully installed by the deadline to be eligible. To claim the tax credit on your return, you must complete your installation before the end of the 2019 calendar year.
For commercial systems, you just need to start installing before the end of 2019. The equipment needs to be shipped and you have to break ground on the project before the deadline—but unlike residential projects, it doesn’t need to be finished to be claimed on your return.
What You Need To Do To Make the 2019 Solar ITC Deadline
Designing and building a solar system isn’t a project that happens overnight.
Between planning, design, permitting, shipping, installation, and final inspection, it can take weeks—if not months—to make it through the whole process.
We can tell you from experience that December is our craziest time of year. We always get a surge of people who scramble to build their system before the end of the year so they can claim the credit on their next tax return.
But oftentimes they procrastinate and miss the deadline, because they underestimate how long the process takes.
So if you want to hit the 2019 deadline and claim the full 30% tax credit, we recommend getting started ASAP. Here’s our overview of how long you can expect each step in the process to take:
Research & Planning: 1-2 weeks
First you need to decide whether solar is right for you. In this phase, you’ll research some basic questions like:
These are a few of the most common questions people have about solar power, but it is certainly not a complete list. You’ll likely spend a decent amount of time doing this preliminary research before you’re ready to talk to a design technician.
Everybody goes through the research phase at their own pace. But if you want to move things along in time to claim the full 30% tax credit, we’d recommend you carve out 1-2 weeks for research. That’s enough time to answer common questions, do the math on ROI, and decide if going solar makes sense for you.
System Design: 1-2 weeks
In this step, you’ll connect with our design techs for a guided design consultation. We’ll look at factors like energy usage, local climate, and build site considerations. With this info in mind, we’ll design a system that is tailored to your energy usage and local sun exposure.
Once we have a design in place, our design tech will send you a quote. You can review this quote and request adjustments if necessary.
Plan to budget at least a week for this phase—more if the design goes through a round of revisions. It’s a collaborative process and there will be some back-and-forth communication between you and your design consultant.
Permitting: 2-4 weeks
Permitting is often the most time-consuming part of the process. Before you can build, you’ll need a permit approved by your local building authorities.
This involves filing a permit request with product spec sheets and a wiring diagram attached. They may also require a site visit by certified inspectors before you can move forward.
The average timeframe here is about 2 weeks, but it can be longer depending on how responsive your local building departments are. We’ve seen permits stamped in just a few days, while others get delayed in the permitting process for several weeks.
Sourcing & shipping: 3+ weeks
We need time to pack and ship your equipment. Most components are stocked in our warehouse, while less common items are ordered on demand from the manufacturer, which extends the shipping time frame.
Leave at least 3 weeks for distribution—more if we need more lead time to coordinate back orders with the manufacturer.
Installation: 1-2+ weeks
Depending on the complexity of the system, and your experience level with projects like these, it’s possible to completely install your system over the span of a weekend.
However, it’s more likely that DIYers take a bit more time to figure out the process and make sure they do each step correctly. After all, your system lasts for 25 years—it’s important to take time during installation to get it right.
DIY installs are typically completed over the span of a few weekends, so we would advise you to budget at least 2 weeks for this. It could be a bit faster if you hire an installer—just make sure to schedule them to install it when your shipment arrives, so the system isn’t gathering dust in your garage.
How Much the Investment Tax Credit Can Save You
Wondering what kind of impact the expiration of the tax credit will have on the cost of your system? Let’s look at a few real-world examples.
The average American household uses about 900 kWh of energy each month. Let’s see what it would cost to completely offset that usage, and how much you stand to get back from the 30% tax credit.
This chart is broken out into grid-tied and off-grid systems, with the option to install it yourself or hire a contractor to do it for you at $1/watt. In all cases, we’ve assumed $1,000 for fees associated with shipping and permitting.