On Aug. 16, 2022, President Joe Biden signed into law the Inflation Reduction Act of 2022 (IRA), which includes new and revised tax incentives for clean energy projects. Considered the most significant climate legislation in U.S. history, it offers funding, programs, and incentives to businesses, nonprofits, educational institutions, and state, local, and tribal organizations who were not able to monetize renewable energy projects before. Most provisions of the IRA became effective 1/1/2023.
How the IRA applies to Sunbolt
The IRA solar tax credit applies to projects under 1MW (all Sunbolt products) and features:
- 30% investment tax credit (ITC) available for solar projects that produce electricity and is refundable for entities that have no tax liability
- There are additional credits available if your project qualifies for:
- Domestic content minimum
- Siting in an energy community or low-income community or on Indian land
- Qualified Low-Income Residential Building Project or Economic Benefit Project
As with all new legislation, the IRS is providing ongoing guidance which we are following.
As of this writing, it is in our opinion that all Sunbolt solar products qualify for favorable tax treatment under the IRA.
Please consult your financial advisor for your specific tax circumstances.