Utah Solar Tax Guide
Seven States. One Purpose.
Renewable energy systems tax credit
For Utah homeowners that invest in solar, the state government will give you a credit on your next year’s income taxes to reduce your solar costs. You can claim 25 percent of your total equipment and installation costs, up to $1,200. That’s in addition to the 26 percent federal tax credit for solar. [Note that this tax credit will be reduced in value by $400 each year and expires completely in 2022]
Utah is a “Right to Solar” state
Thanks to Utah’s solar easement law you can work with your neighbors to make sure that nothing shades your solar panel system while the sun is shining. Also, Utah is a Right to Solar state, so your local zoning authority can prevent developers from prohibiting the installation of solar panels on your home.
Net metering in Utah
Net metering (also known as net energy metering) is a solar incentive that allows you to store energy in the electric grid. When your solar panels produce excess power, that energy is sent to the grid and in exchange, you can pull from the grid when your system is under-producing like during nighttime.
With the right size solar energy system, you can produce enough electricity to match your home’s electricity use for the entire year. However, the amount of electricity your solar panels produce will vary throughout the year. Net metering helps you account for these differences by crediting you for the excess electricity your panels produce so you can use it later.
Federal solar tax credit (ITC)
The federal solar tax credit, also known as the investment tax credit (ITC), allows you to deduct 26 percent of the cost of installing a solar energy system from your federal taxes. The ITC applies to both residential and commercial systems, and there is no cap on its value.