ARIZONA COMMERCIAL SOLAR PANELS
Businesses in Arizona may be eligible for the 10% Energy Community Federal tax credit adder on commercial solar panel projects (bringing total Federal tax credits to 40%!) thanks to the Inflation Reduction Act passed by the Biden Administration in 2022.
The Internal Revenue Service added 446 more US counties last month to the list of counties where renewable energy projects qualify potentially for a 10% energy community bonus tax credit! See below for a screenshot of the DOE’s most recent Energy Community metropolitan statistical area (MSA) map that indicates eligible geographic areas for the Energy Community tax credit bonus.
More details about energy community bonus credits can be found here.
Arizona Businesses may be eligible for an additional 10% Federal Tax Credit (total of 40%) for installing commercial solar panels due to being in an IRS designated Energy Community!
Eligible Projects
A project on which an investment tax credit will be claimed qualifies for an energy community bonus credit if it is in an energy community when the project is placed in service, meaning businesses commencing commercial solar projects in Q4 2024 must complete and commission their project prior to the new DOE MSA guidance being issued in June of 2025. If your Arizona business is interested in transitioning to solar and battery storage, it is imperative you reach out to us TODAY to take advantage of this lucrative incentive before it expires!
Qualification can be locked in by starting construction for tax purposes when the location qualifies. Construction cannot have started before 2023.
Three types of areas qualify potentially as energy communities. They are:
- brownfield sites,
- census tracts (and adjoining tracts) where a coal mine closed after 1999 or a coal-fired generating unit closed after 2009, or
- statistical areas that had at least 0.17% direct employment in oil, natural gas or coal at any time after 2009 and had a local unemployment rate the year before the qualification year at least as high as the national rate. For example, an area with higher local unemployment than the national rate in 2022 qualified potentially as an energy community in 2023.
Contact Us
Want to minimize your organization’s Federal tax liability through Federal tax credits and commercial solar panel depreciation: https://www.beachcitiessolarconsulting.com/commercial-solar-panel-depreciation/? Inquire today for a commercial solar and battery quote through the contact us button below!
This blog provides an overview of the Federal solar investment tax credit energy community 10% adder available for businesses that own solar facilities. It does not constitute professional tax advice or other professional financial guidance and may change based on additional guidance from the Treasury Department. Please consult a licensed tax professional regarding your organizations specific situation as we are not tax advisers.
