Ohio Solar Tax Credit

One of the most lucrative incentives available to solar enthusiasts is the Investment Tax Credit (ITC), a powerful tool allowing you to slash your expenses by a third! Wondering how to seize this opportunity? Explore our guide on claiming the Solar Tax Credit in Ohio.

What is the Solar Tax Credit?

The Solar Investment Tax Credit (ITC) enables both businesses and homeowners to receive a tax credit amounting to 30% of the solar panel system's cost. Unlike a rebate, the ITC directly reduces the income tax you owe.

The Solar Tax Credit is accessible to those who install solar panels before December 31, 2034, with a gradual reduction to 26% in 2033 and 22% in early 2034.

How does the Ohio Solar Tax Credit work in practice?

For example, if a household installs a $20,000 solar panel system, they can deduct $6,000 from their income taxes, bringing the net cost down to $14,000. Any remaining credit can be carried over to subsequent years, ensuring you receive the full 30% promised by this solar incentive.

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To qualify for the ITC, you must own the solar energy system, as leased systems do not qualify. Additionally, the system must be installed in the United States and be new or used for the first time.

How do I get a solar tax credit in Ohio?

The Solar Tax Credit is claimed after the solar system is installed. Maintain detailed records of related expenses, including invoices and receipts, which may be needed in case of an audit.

To claim the credit, complete IRS Form 5695 and attach it to your federal income tax return, ensuring you include residential energy credit information on Schedule 3 (Form 1040).

Need help? Follow our guide!

We cover filling out the forms for claiming ITC step by step

Step-by-step guide

Benefits of the Ohio Solar Tax Credit

The Ohio Solar Tax Credit covers not only solar panels but also all associated equipment, shipping, and labor expenses, with no cap on the claimed amount. 

In addition to the federal credit, Ohio offers state-level incentives and rebates that can further reduce upfront costs—explore more in our Ohio solar incentives guide.

Julia Zaraeva

Author

Years of experience in translation and a love of nature help Julia find the right words to encourage going solar. She joined the team in 2023 and is happy to make her contribution to a greener future.

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