No matter what state you live in, you’ll be eligible for a 30% Federal Solar Tax Credit when you purchase your own solar system. This means that the Government will pay 30% of the system cost after 18 months of the installation date. Also, you can check which local solar and battery rebates you may be eligible for from your local utility.


If you decide to lease the panels instead of buying them, the great thing is that any benefits you would get through rebates and tax credits come to you in the form of a lower monthly cost with Babio. We’ll handle everything and take care of all the paperwork.

To qualify for the 30% Federal Solar Tax Credit you must meet the following requirements:

• You must own your home. Renters are not eligible
• You must own your solar panels and batteries. If you lease a solar system, you can’t claim the credit directly
• You must pay enough taxes to the federal government to qualify for the 30% tax credit.

If you install a solar energy system, there are three main ways to pay for it, and each has its own benefits when it comes to the Federal Solar Tax Credit:

• Cash purchase: You own the system so you are eligible to apply for tax credits
• Finance (Loan): You may be entitled to the full Federal Solar Tax Credit even if you put $0 down
• Lease/PPA: At Babio savings are passed along as part of your lease contract, but you can’t claim them directly. You will benefit of the credits in the form of a lower monthly lease payment.

To receive your tax credit, you must complete the IRS From 5695 when you file your taxes and add your renewable energy credit information to your Form 1040.

When you finance solar panel installation with a loan, you’re eligible for the federal solar investment tax credit (ITC), which covers 30% of your solar system’s cost, including panels, inverters, installation labor, and other eligible expenses. This credit is applicable for the year the solar installation is completed, and any excess credit can be carried forward for up to five years. It’s important to note that some financing programs expect you to repay the solar tax credit to the financier, typically within 18 months post-installation. This arrangement can lead to increased loan payments if the credit is not repaid within these 18 months. If you have more questions, contact us to answer all your questions.