Hello
I got my PV system installed last year so the income that I generated from the sale of SRECs will be part of my taxes. I am taking the 30% ITC credit. I was wondering if anyone has though of considering the SREC income as business income. If that is the case, depreciation of the PV system (see attached) could be used to offset the taxes on the SREC income.
I'm working with a CPA but no one has posed this question to him before. He is looking into it. He said that most people just take the 30% ITC and stop there. One negative of considering the SREC income as business is that I would have to also pay for self-employment taxes for that income but it seems that on the long run, doing the depreciation of the cost of the PV system would put me ahead.
Has anyone here done something similar / different to offset the taxes on SREC income?
I see two ways of looking at it...
1. If I'm paying taxes on the income from SREC sales, I should also be able to deduct the depreciation of the system that generated that income like any other business would.
2. I'm already benefiting by getting "free" electricity so I shouldn't push it and just be thankful that I have net-metering in NJ and can sell the SRECs
I got my PV system installed last year so the income that I generated from the sale of SRECs will be part of my taxes. I am taking the 30% ITC credit. I was wondering if anyone has though of considering the SREC income as business income. If that is the case, depreciation of the PV system (see attached) could be used to offset the taxes on the SREC income.
I'm working with a CPA but no one has posed this question to him before. He is looking into it. He said that most people just take the 30% ITC and stop there. One negative of considering the SREC income as business is that I would have to also pay for self-employment taxes for that income but it seems that on the long run, doing the depreciation of the cost of the PV system would put me ahead.
Has anyone here done something similar / different to offset the taxes on SREC income?
I see two ways of looking at it...
1. If I'm paying taxes on the income from SREC sales, I should also be able to deduct the depreciation of the system that generated that income like any other business would.
2. I'm already benefiting by getting "free" electricity so I shouldn't push it and just be thankful that I have net-metering in NJ and can sell the SRECs
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