Part of the American Recovery and Reinvestment Act is the Residential Energy Efficient Property Credit. This incentive provides a 30% solar energy tax credit for consumers who install either solar PV or solar thermal systems in homes before December 31, 2016.
To apply the solar tax credit to solar thermal systems, at least half of energy used to heat water for the home must be derived from the solar thermal system. There are no such conditions for the tax credit for photovoltaic panels.
In addition to this federal energy tax credit, many states offer additional tax incentives. These can be found on the Database of State Incentives for Renewables & Efficiency (DSIRE). Instructions for claiming the federal tax credit are also available at EnergyStar.
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