Blog: Solar cash grant set to expire
ProudGreenHome Approved Contributing Expert Heather Ferrier shares her opinions in this blog on the solar cash grant program:
In 2009 Congress created the 1603 Program: Payment for Specified Energy Property in Lieu of Tax Credits to cover 30 percent of a project's costs in the form of a cash grant. The incentive program was created as an alternative to the 30 percent investment tax credit and was set to expire at the end of last year before a last minute decision extended it through 2011.
Certain projects can claim the cash grant much sooner than the tax credit, although the grant is set to expire at the end of 2011 and the credit remains in effect through 2016.
With the grant deadline looming, many solar companies are gearing up for what they expect to be a high volume fourth quarter. At this time it is unclear if the grant will once again be extended, although the solar industry remains hopeful.
The program requires projects to start construction before the end of the year (and reach completion by 2016) in order to qualify for the grant.
Property used in a building that is used for residential purposes may be eligible if it is subject to depreciation or amortization in lieu of depreciation by its owner. This means that the property must be used in a trade or business or for the production of income. If, however, the applicant is a homeowner who installed a solar energy system on the roof of his/her home and uses the solar energy property for personal purposes, the property would not be subject to depreciation and therefore would not be eligible.
More information is available on the 1603 Program.
For more information, see our Energy Rebates and Tax Credits research center.
Topics: Rebates / Tax Credits