Federal Tax Credit

[ndabunka]

His parents.

IRS agents don't have parents. They are bred from test tubes...

[Living Large]

Thanks. Do you think it is a good idea to let the IRS auditor touch my system to see if it is installed, live and working? If the tax auditor get electrocuted, who would be responsible?

His parents.

[supersolar]

I would make sure there's sufficient evidence that the system was put into service.
Photos of the system working would be good evidence IMO.
Contract with installer showing it was completed on X date would be good evidence as well IMO.

Frankly I think it's really unlikely you'd get audited - but having the documentation should only take a few minutes to put together and put in your taxes file folder for the year.

Thanks. Do you think it is a good idea to let the IRS auditor touch my system to see if it is installed, live and working? If the tax auditor get electrocuted, who would be responsible?

[foo1bar]

I am going to install an off grid system (which qualifies for the federal incentive). Who do I need to sign off? There is no need for permits. The solar vendor that installed it signed off. Is that enough?

I would make sure there's sufficient evidence that the system was put into service.
Photos of the system working would be good evidence IMO.
Contract with installer showing it was completed on X date would be good evidence as well IMO.

Frankly I think it's really unlikely you'd get audited - but having the documentation should only take a few minutes to put together and put in your taxes file folder for the year.

[supersolar]

It is NOT when the contract is signed.





Other clarifications on the matter (which do not established precedent mind you) have described a test for "installation is completed" along the lines of "permits completed", "construction completed", and the last being "performing it's function as intended". If you ever got audited, I would feel pretty good with just the final inspector signoff using that date. But to be bulletproof, you would need the inspection and local utility signoff. Depends on factors out of our knowledge at the moment, like how the auditor feels that day about you (or if any other directives or precedents are established by the time you are audited).

I am going to install an off grid system (which qualifies for the federal incentive). Who do I need to sign off? There is no need for permits. The solar vendor that installed it signed off. Is that enough?

[cebury]

Oh and I'm not a CPA or tax attorney either. I just work "closely" with a CPA firm, professional-only tax filing software (not H&R block or Intuit), and researched various interpretations on tax issues using paid services like RIA checkpoint. After saying all that, I'm still "some guy on the internet" and the opinion is worth what you paid if you ever get audited.

[cebury]

when would be last date to get this credit, is it when its installed or when contract date is signed

It is NOT when the contract is signed.

The IRS definition in § Section 25D
(a) Allowance of credit
In the case of an individual, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to the sum of—
(1) 30 percent of the qualified solar electric property expenditures made by the taxpayer during such year,

(e) Special Rules: For purposes of this section—
(8) When expenditure made; amount of expenditure
(A) In general: Except as provided in subparagraph (B), an expenditure with respect to an item shall be treated as made when the original installation of the item is completed.
(B) Expenditures part of building construction
In the case of an expenditure in connection with the construction or reconstruction of a structure, such expenditure shall be treated as made when the original use of the constructed or reconstructed structure by the taxpayer begins.

Other clarifications on the matter (which do not established precedent mind you) have described a test for "installation is completed" along the lines of "permits completed", "construction completed", and the last being "performing it's function as intended". If you ever got audited, I would feel pretty good with just the final inspector signoff using that date. But to be bulletproof, you would need the inspection and local utility signoff. Depends on factors out of our knowledge at the moment, like how the auditor feels that day about you (or if any other directives or precedents are established by the time you are audited).

[foo1bar]

when would be last date to get this credit, is it when its installed or when contract date is signed

I believe that when it is installed ("put into service") is the only date the IRS looks at.
So you have ~40 days if you want it done in 2015 and ~405 days if you want it done in 2016.

But I'm not a tax preparer, other than my own taxes.

[harleydee]

when would be last date to get this credit, is it when its installed or when contract date is signed