pv system depreciation for rental

[mactoolsix]

26 USC § 25D - Residential energy efficient property

(a) Allowance of credit
(1) 30 percent of the qualified solar electric property expenditures made by the taxpayer during such year,

(d) Definitions
(2) Qualified solar electric property expenditure
The term “qualified solar electric property expenditure” means an expenditure for property which uses solar energy to generate electricity for use in a dwelling unit located in the United States and used as a residence by the taxpayer.

http://www.law.cornell.edu/uscode/text/26/25D

Oops - I forgot to post the time involved to look that up - about 10 minutes! I don't charge good clients for 10 minutes, and I consider members of this board the best,
Mike

[Gary2]

The familiar Residential Energy Efficient Property Credit, done on the front page of Form 5695, is enabled by IRC 25D. In the case of solar electric, it's specifically 25D(d)(2), which says "uses solar energy to generate electricity for use in a dwelling unit located in the United States and used as a residence by the taxpayer." This would seem to exclude total rentals, though it's less clear how to deal with duplexes and such. I saw no clarifications in the obvious sections of the ECFR.

The less familiar Energy Investment Credit, is done on Form 3468, line 12b, and enabled by IRC §48, and in particular, 48(a)(3)(A)(i), along with 48(a)(3)(C) which says "with respect to which depreciation (or amortization in lieu of depreciation) is allowable". By itself, this would appear to include solar electric for rental properties, except that one must also check §50, particularly 50(b)(2), which excludes property used for lodging - until one gets to 50(b)(2)(D), which excludes energy property from the no-lodging restriction.

This took me maybe 15-20 minutes to look up, and another 15-20 to type, including the time spent looking up how to enter the § symbol (but not including the wild goose chase I went down, reading the regs, because I didn't finish reading 50(b)(2)).

PS: I was still working on mine while maxtoolsix posted his, so I hadn't seen his time involved statement. Interesting that we both independently felt a need to add that to our posts.

[taxea]

To each his own..it is the TP who will lose out. If and when I have the time I will research and post the information...for now, sorry, but I have compliance deadlines to deal with

[mactoolsix]

The familiar Residential Energy Efficient Property Credit, done on the front page of Form 5695, is enabled by IRC 25D. In the case of solar electric, it's specifically 25D(d)(2), which says "uses solar energy to generate electricity for use in a dwelling unit located in the United States and used as a residence by the taxpayer." This would seem to exclude total rentals, though it's less clear how to deal with duplexes and such. I saw no clarifications in the obvious sections of the ECFR.

The less familiar Energy Investment Credit, is done on Form 3468, line 12b, and enabled by IRC §48, and in particular, 48(a)(3)(A)(i), along with 48(a)(3)(C) which says "with respect to which depreciation (or amortization in lieu of depreciation) is allowable". By itself, this would appear to include solar electric for rental properties, except that one must also check §50, particularly 50(b)(2), which excludes property used for lodging - until one gets to 50(b)(2)(D), which excludes energy property from the no-lodging restriction.

Thus, after studying Garys post and the relevant cites, the credit for solar electric is allowed for rentals under Energy Investment Credits. I also would like to add that per §50(c)(3) the basis is reduced by only 50% of the credit taken.

Mike

[WhiteOleander]

The familiar Residential Energy Efficient Property Credit, done on the front page of Form 5695, is enabled by IRC 25D. In the case of solar electric, it's specifically 25D(d)(2), which says "uses solar energy to generate electricity for use in a dwelling unit located in the United States and used as a residence by the taxpayer." This would seem to exclude total rentals, though it's less clear how to deal with duplexes and such. I saw no clarifications in the obvious sections of the ECFR.

The less familiar Energy Investment Credit, is done on Form 3468, line 12b, and enabled by IRC §48, and in particular, 48(a)(3)(A)(i), along with 48(a)(3)(C) which says "with respect to which depreciation (or amortization in lieu of depreciation) is allowable". By itself, this would appear to include solar electric for rental properties, except that one must also check §50, particularly 50(b)(2), which excludes property used for lodging - until one gets to 50(b)(2)(D), which excludes energy property from the no-lodging restriction.

This took me maybe 15-20 minutes to look up, and another 15-20 to type, including the time spent looking up how to enter the § symbol (but not including the wild goose chase I went down, reading the regs, because I didn't finish reading 50(b)(2)).

PS: I was still working on mine while maxtoolsix posted his, so I hadn't seen his time involved statement. Interesting that we both independently felt a need to add that to our posts.

Thank you very much. I was not aware of this credit availability. I appreciate you posting the info.