ITC stands for Investment Tax Credit. The tax credit is a dollar-for-dollar reduction in the income taxes that a person or company would otherwise pay the federal government. Currently, the solar ITC is 30% of the basis that is invested in solar project construction through 2019. The ITC then steps down to 26 percent in 2020 and 22 percent in 2021. After 2021, the tax credit will be 10%.
NOTE: Due to the tax-exempt status of municipalities, K-12 school districts, state agencies, public colleges and universities, and not-for-profit organizations, these entities are not eligible to claim the federal ITC as a dollar-for-dollar reduction against the cost of the solar PV system, as a taxable entity would be.
SEIA ITC Overview:
Department of Energy ITC Overview:
IRS Forms and Information: