Federal and state tax credits are currently available for homeowners and businesses to promote energy efficiency, encourage the use of renewable energy sources, and support efforts to conserve energy and lessen pollution.
Iowa offers a tax credit equal to 50% of the federal solar tax credit of 30%. Both can be claimed on your yearly tax returns for after a solar installation was completed on your home. Individuals and businesses are eligible for a state tax credit up to a maximum of $5,000. Any excess credit (i.e., if your credit reduces your tax burden below $0) may be carried over for up to ten years.
New solar owners in Iowa must apply online by May 1st of the year after installation. Each year, the state has a $5 million cap for all tax credits, but timely applications will be put on a waiting list for the next year’s limit. Once your application is approved, a tax credit certificate will be mailed to you.