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Solar Investment Tax Credit. Has anyone gotten the Tax Credit?


Al F

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I haven't yet but I am going to this year. You need to buy the stuff before year end if you have not already. I was not going to install my solar untilnext year but pushed it up becuase of the credit. From what I have read and the cases reviewed it looks like the credit is available. There is a discussion on some of the soalr sites that then cite tax law cases etc. I looked at the cases and I feel comfortable with claiming the credit. For me it is going to be the cost of the lithiums, Magnum hybrid converter, lithium batteries, battery monitoring system, solar controller, wiring and connectors together with the panels.

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You can claim anything that you wish and as long as you are not audited, it works. I doubt that any of us are tax attorneys so are little better informed than you. While someone having been rejected for such a deduction may indicate it is not valid, the fact that it was not caught in the past doesn't make it valid. Make your best judgement and deal with it if you should be contacted by the IRS auditors.

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You can claim anything that you wish and as long as you are not audited, it works. I doubt that any of us are tax attorneys so are little better informed than you. While someone having been rejected for such a deduction may indicate it is not valid, the fact that it was not caught in the past doesn't make it valid. Make your best judgement and deal with it if you should be contacted by the IRS auditors.

I very much agree with Kirk on this. I did look at this issue, as an attorney, to determine whether it was nonsense or whether the credit could be available to rv owners. The credit does exist for RVers in some situation but as to your specific situation you need to make your own determination and have appropriate documentation. Oldman's comment above is a perfect example of the misunderstanding many people have. The test is not whether you file and no one says anything. The test is whether you get audited and don't get fined or jailed.

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If you file online, I find you can get away with much more.

 

Is that a joke oldman? There is no difference. If you get audited, you get audited.

No it isn't. Years ago when filing on paper, I had to provide paper proof every year to show I was paying child support. First year I filed online, paper gone. No proof necessary. The government loves electronic filing.

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But if you get audited, you need to provide the exact same information. There are not 2 standards. There are all kinds of things that are not fully documented with the return. That does not mean we can say whatever we want. The tax code is the tax code--electronic or paper.

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Quick comment. Check the Solar Tax Credit form. I believe you MUST be connected to the grid to get the credit. I don't know if the IRS would consider boondocking as a reason to not allow the tax credit.

 

Other comment. I use to file electronically until I got a notice in the mail that said "thanks for the check, but we never got your return'. It came in a poor quality envelope and was such a poor xerox copy that my wife said "throw it away, it is a scam". Well, it wasn't.

 

This lead to an adventure where the IRS lost the electronic copy and then followed up with losing the next TWO paper copies I mailed them. This was just after the IRS and conservative group issue became public. And a year earlier I had a couple of articles published in a politically conservative magazine.

 

Jeez, given my cultural heritage there is enough paranoia in my brain without feeding it!!!

 

Really, I think the only difference is when you file electronically you are entered into the IRS database and then they run a program to see if your deductions are out of line. They also run a program to see if you claimed ALL your income. The results of the second I have seen when I worked as a financial advisor.

 

I suspect if you send a paper copy a IRS employee quickly scans your return and decides if you won the "lottery".

 

I did receive confirmation that the electronic return was received by the clearing house, but the IRS does not send one if they got it!! So I have no idea who really lost it.

 

So now, it is a paper copy, with a signed return receipt requested.

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Quick comment. Check the Solar Tax Credit form. I believe you MUST be connected to the grid to get the credit. I don't know if the IRS would consider boondocking as a reason to not allow the tax credit.

 

 

 

Vladimir, I had spent some time looking at that form and remember being confused. After looking at the code and regs again I felt those provisions of the form relate to the credit for the Qualified Fuel Cell credit, not the solar panel credit.

 

If you, or anyone else, have an opinion or information to the contrary I am all ears. I am certainly not trying to get away with anything. I want to do this right. However, if you look carefully at the form and realize it is a form being used for more than one purpose, I think it becomes clear those provisions do not relate to a solar panel system.

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We have a solar home that is off-grid. We did NOT qualify for the credit since we were off-grid and had no way to connect.

 

However, a quick search and I found this site: http://solaroutreach.org/wp-content/uploads/2015/03/ResidentialITC_Factsheet_Final.pdf

 

And this site: http://energy.gov/savings/residential-renewable-energy-tax-credit

 

Since RV's are considered as second homes for tax purposes...looks like you might be ok.

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As I remember, we took the solar tax credit for a solar system on our RV in 2010.

The key to using IRS Form 5695 for a tax credit is reading the Instructions for Form 5695 which contain the necessary definitions and requirements. Note that in 2014, the instructions are a separate document -- not in the form itself.

 

All the other links in this thread I've seen so far may be informative, but do not pertain directly to the tax credit form itself.

 

Like many things, I'm sure two intelligent people can read the same thing and come away with different conclusions. However, a couple of comments I've read in this thread indicate a real lack of familiarity with the specifics of IRS 5695. Also, some comments are just based on hearsay.

 

If you're thinking about taking the tax credit, first read the IRS form and the instructions. Then run it by your tax preparer.

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We have a solar home that is off-grid. We did NOT qualify for the credit since we were off-grid and had no way to connect.

 

However, a quick search and I found this site: http://solaroutreach.org/wp-content/uploads/2015/03/ResidentialITC_Factsheet_Final.pdf

 

And this site: http://energy.gov/savings/residential-renewable-energy-tax-credit

 

Since RV's are considered as second homes for tax purposes...looks like you might be ok.

 

 

"> …I AM NOT CONNECTED TO THE ELECTRIC GRID?

Yes. A solar PV system does not necessarily have to be connected to the electric grid for you to claim the ITC, as long as

it is generating electricity for use at your residence.

This quote if from this PDF Document

While the above document is not a government document it does give enough info to reconsider the decision to NOT file for the solar tax credit.

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I haven't yet but I am going to this year. You need to buy the stuff before year end if you have not already. I was not going to install my solar untilnext year but pushed it up becuase of the credit. From what I have read and the cases reviewed it looks like the credit is available. There is a discussion on some of the soalr sites that then cite tax law cases etc. I looked at the cases and I feel comfortable with claiming the credit. For me it is going to be the cost of the lithiums, Magnum hybrid converter, lithium batteries, battery monitoring system, solar controller, wiring and connectors together with the panels.

 

It is not when you buy the solar stuff, but the tax year you install/activate the equipment.

 

 

Costs. For purposes of both credits, costs are treated as being

paid when the original installation of the item is completed

The above quote is from IRS form 5695 "instructions".

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As I remember, we took the solar tax credit for a solar system on our RV in 2010.

 

The key to using IRS Form 5695 for a tax credit is reading the Instructions for Form 5695 which contain the necessary definitions and requirements. Note that in 2014, the instructions are a separate document -- not in the form itself.

 

All the other links in this thread I've seen so far may be informative, but do not pertain directly to the tax credit form itself.

 

Like many things, I'm sure two intelligent people can read the same thing and come away with different conclusions. However, a couple of comments I've read in this thread indicate a real lack of familiarity with the specifics of IRS 5695. Also, some comments are just based on hearsay.

 

If you're thinking about taking the tax credit, first read the IRS form and the instructions. Then run it by your tax preparer.

 

Is something specific you see in the instructions or IRS form which, in your opinion, excludes RV's?

 

 

This is from IRS Form 5695 instructions:

Who Can Take the Credits

You may be able to take the credits if you made energy saving

improvements to your home located in the United States in

2014.

Home. A home is where you lived in 2014 and can include a

house, houseboat, mobile home, cooperative apartment,

condominium, and a manufactured home that conforms to

Federal Manufactured Home Construction and Safety

Standards

 

While the above quote does not specify RV's, it certainly includes some very similar homes i.e. houseboat, manufactured home.

 

I do my own taxes, so I don't have a tax preparer to consult. I guess that is kind of like Doctors don't operate on themselves & Lawyers don't defend themselves.

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I am wondering if my rv home, being owned by our Montana LLC, is considered our home for tax credit purposes. Bennett Law, our LLC attorney, said I would need to ask a tax lawyer.

 

I've never been audited. What happens if the IRS audits my return and determines we should not have claimed the solar tax credit? How much could they fine me? Seems to me that it would just be considered an "honest" mistake and they should just make me pay back the credit.

 

Previously when I had an unusual situation and had trouble understanding the IRS instructions on it, I called the IRS. Actually, I think I called a few times until I had a majority of like answers, as they were not all in agreement. If I recall correctly, each prrson i spoke to qualified their response by saying something to effect that their opinion may not be the final determination by the IRS.

 

Jim

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Is something specific you see in the instructions or IRS form which, in your opinion, excludes RV's?

 

Since I took the tax credit, there wasn't anything overpowering enough to convince me not to.

 

While the above quote does not specify RV's, it certainly includes some very similar homes i.e. houseboat, manufactured home.

 

That's what I thought too.

 

I do my own taxes, so I don't have a tax preparer to consult. I guess that is kind of like Doctors don't operate on themselves & Lawyers don't defend themselves.

Bad analogy -- doctors and lawyers are experts. You're just doing your own taxes.

 

From your responses, you seem to have made up your mind. Nevertheless, I'd still suggest checking with a tax preparer instead of an RV forum.

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Al, right, the components need to be installed and activated. I did the install and activate this year. I was going to put in the system in two different stages with the solar panel install coming next year but I did it all at once to take advantage of the credit and make clear I was indeed installing a system.

 

I don't think the instructions to the form are that helpful. They leave open a number of questions. I have my research somewhere in backup and I will look at it once again before I actually file the taxes but before I bought anything I looked at: the actual tax code provisions, the tax code regulations, IRS tax cases decided under those provisions, IRS pamphlet on home credits and deductions, the IRS form and instructions to form, articles on the issue and discussions on the forums. The way I listed these things, in my opinion, corresponds with the strength and trustworthiness of the source. Once I finished the review of the statute, regulations and case law, I did my own analysis of whether the credit would be valid in my situation. I concluded the credit applied. I then looked to articles, forums etc. to see if I could find anything that contradicted my conclusion. I have not found anything to this point but as I said, I intend to thoroughly review everything once again before I file.

 

In my case we purchased a new fifth wheel. I pulled the two 12 volt batteries that came with the unit and purchased 700 amp hours of Lifepo4 batteries. I purchased a magnum hybrid inverter/converter. Both the batteries and inverter/converter were purchased for the purpose of maximizing the fifth wheels ability to store and utilize solar energy either stand alone or as a supplement for when we are fully hooked up. I also added a battery monitoring system for the lithium batteries. The battery install and inverter install all required new heavy gauge wiring. I then proceeded to install a morningstar solar controller and three solar 300 w solar panels. As part of that portion of the install I also purchased and installed new wiring to replace the inadequate prewiring that came new with the unit. I intend to include all of these costs in the iRS credit form. We also sold our home and live in the fifth wheel full time. When I double check my research I am going to focus especially on the battery issue but I do recall concluding that the batteries are viewed as a component of the system necessary to store generated electricity. I did consider it important, although I am not sure of the degree, that the components are purchased as a system for the install. In other words simply buying new batteries when you already have had the panels is a reach.

 

Again, I welcome anyone to challenge these conclusions. In all of my research, I never came across any requirement of needing to be attached to the grid. Everyone needs to do their own research, and/or talk to your tax advisor, but I do think forum discussions are a helpful check on real world experience and for issue spotting. While a consensus on a forum board will be meaningless to the IRS it does increase, at least my, comfort level.

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I am wondering if my rv home, being owned by our Montana LLC, is considered our home for tax credit purposes. Bennett Law, our LLC attorney, said I would need to ask a tax lawyer.

 

I've never been audited. What happens if the IRS audits my return and determines we should not have claimed the solar tax credit? How much could they fine me? Seems to me that it would just be considered an "honest" mistake and they should just make me pay back the credit.

 

Previously when I had an unusual situation and had trouble understanding the IRS instructions on it, I called the IRS. Actually, I think I called a few times until I had a majority of like answers, as they were not all in agreement. If I recall correctly, each prrson i spoke to qualified their response by saying something to effect that their opinion may not be the final determination by the IRS.

 

It sounds like the one thing you were advised to do (asking a tax attorney), you did not do.

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