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  • #16
    Originally posted by J.P.M. View Post

    No, that's not what I'm saying at all. And it looks to me like you may be inferring more than I'm meaning or simply trying to be a PITA.
    You can call me anything you like. My objective was to add clarity.
    Anyway, and a further point to your question, if the OP does sell excess equipment in the future, any such equipment might be considered used anyway and so ineligible for any fed. tax credit for any future buyer of such used equipment.
    If the OP hasn't used the equipment and sells it to the next purchaser as new equipment I think there is a good chance it could be considered new. I also I think a credit of $300 for $1,000 of equipment is not likely to get audited.

    However, I must thank you for making me check my information. My prior statement to this thread with respect to the placed in service date requirements for U.S. federal tax credit eligibility was [U]incorrect......

    But, antecedent information is necessary: The placed in service date for solar projects must first be established. That date, according to the IRS, can be determined in one of two ways. One way is to actually start work according to IRS definitions. The second, which may be more applicable to the OP's situation, is when the person/entity intending to claim the tax credit has incurred 5% of the cost of the project, including equipment costs. Either method requires "continuous progress" toward project completion.

    Specifically to my error: The June 2018 IRS ruling changes the latest allowable completion date for projects started in 2019 from 01/01/2020 TO 01/01/2024.

    To be clear, the percentage of a project started after 12/31/2019 that is tax credit eligible still declines to 26 % for 2020 and declines further in following years. But projects started in 2019 according to the June 15 , 2018 IRS guidelines still qualify for the 30%, and once begun, have until 01/01/2024 to complete.
    ..............
    No worries, I am glad my comment helped you add further clarification which was userful. If you didn't clarify, I was going to add the following from my experience. Apparently payment for the equipment is not the important date. For example one could argue that my system was placed in service in December 2017 when the County approved the solar part of the installation. However, because of delays with PG&E and the County, the upgrade of my service panel did not take place until last week. I have signed a completion certificate and funds will be released to the contractor next week. I expect to get my Permission to Operate in 30 days. Apparently I could have taken the Investment Tax Credit for 2017 but I didn't have that interpretation when I filed. I will take the credit for 2018 using the contract amount even though it was not paid for until 2019. In my tax file I have a copy of the County solar inspection approval, a log showing that the system generated power during 2018 and a copy of the contract showing that I was obligated for the amount. Documentation is important, especially in my case where the credit will be approximately $8,000.
    Last edited by Ampster; 03-14-2019, 01:39 PM.

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    • #17
      Originally posted by Ampster View Post

      If the OP hasn't used the equipment and sells it to the next purchaser as new equipment I think there is a good chance it could be considered new. I also I think a credit of $300 for $1,000 of equipment is not likely to get audited.

      No worries, I am glad my comment helped you add further clarification which was userful. If you didn't clarify, I was going to add the following from my experience. Apparently payment for the equipment is not the important date. For example one could argue that my system was placed in service in December 2017 when the County approved the solar part of the installation. However, because of delays with PG&E and the County, the upgrade of my service panel did not take place until last week. I have signed a completion certificate and funds will be released to the contractor next week. I expect to get my Permission to Operate in 30 days. Apparently I could have taken the Investment Tax Credit for 2017 but I didn't have that interpretation when I filed. I will take the credit for 2018 using the contract amount even though it was not paid for until 2019. In my tax file I have a copy of the County solar inspection approval, a log showing that the system generated power during 2018 and a copy of the contract showing that I was obligated for the amount. Documentation is important, especially in my case where the credit will be approximately $8,000.
      On your first point, I'd agree, but since there is only one tax credit allowed for any equipment, it might be kind of tricky for both the OP and any future owner of pre owned equipment to both take a tax credit for the same equipment bought for an original job (by the OP) but not used for that (original) job, but I'd defer to a tax pro or the IRS on that one. If it was me, and I was the OP, and working under the premise that fortune favors the bold (but slaughters the foolish), I'd take the tax credit for the unused equipment as spares necessary for future maint., but I'd guess that would disallow any buyer of the OP's unused equipment from taking a tax credit for that unused but previously tax credited equipment. That could then make things sticky for claiming what would be, in effect, a double tax credit for the used equipment if the buyer of the OP's surplus were to take a tax credit for it as new (original) equipment.

      To your comment about your purchase and put in service date: Sounds to me like how you handled it puts you in conformance with tax code as it may have been in effect for that dates you speak of. However, the IRS bulletin of 06/15/2018 that I referenced looks like it changed at least some of the rules your were working under for what was considered to be significant project milestones and milestone dates for solar projects by the IRS. You didn't have that interpretation because it didn't exist at the time.

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