New Roof Connected to Solar Panels

[Kram BergGold]

The Solar installer told my Clint that the cost of replacing the part of the roof which lies under the solar panels qualifies to be added to the cost of the panels and installation for the credit. Neither I nor a NATP researcher could find anything that supports this position.
This building is a coo-op and my client says the accountants for the other people are adding in the cost of the roof. Does anyone have anything I can use to support either position?

[TAXNJ]

Have

The Solar installer told my Clint that the cost of replacing the part of the roof which lies under the solar panels qualifies to be added to the cost of the panels and installation for the credit. Neither I nor a NATP researcher could find anything that supports this position.
This building is a coo-op and my client says the accountants for the other people are adding in the cost of the roof. Does anyone have anything I can use to support either position?

Is the installer talking about a state or federal credit?

Have you tried to confirm with the other accountants their position. As you know getting information via third party is sometimes not correct.

[Kram BergGold]

Federal Credit

Federal Credit is the issue.

[TaxGuyBill]

It might depend on what you mean by "replacing the roof". Are they just replacing the shingles, or are they changing the structure and strength of the roof to support the solar panels?


I've seen this question pop up a number of times on various forums. From what I've read, unless the new roof has specialized highly reflective shingles to enhance the solar panels, there is nothing that says the cost of replacing shingles counts towards the credit. It seems like this is an extremely common 'sales pitch' from solar panel installers trying to make a sale.

Although I haven't seen anything the specifically has forbid it, in my opinion replacing the shingles is not "an expenditure for property which uses solar energy to generate electricity" or the "labor costs properly allocable to the onsite preparation, assembly, or original installation of the property".

There are a couple of PLR's that specifically say that the BUSINESS credit in §48 for solar do NOT include a roof except to the extent the Highly Reflective Roof price EXCEEDS the cost of a 'regular' roof. Although this is a different credit than the Residential Energy Credit in §25D, it does give some indication for how the IRS views things.

https://www.irs.gov/pub/irs-wd/201523014.pdf

On the other hand, if "replacing the roof" means improving the roof structure to hold the solar panels (rather than just replacing the shingles), you might have a good case that it is for the "onsite preparation" of the solar panels.

[Kram BergGold]

Thanks TaxGiuyBill

Thanks, you are way more knowledgeable on this matter than I. What you say makes a lot of sense.

[taxea]

Kram is correct. Any repair or replacement of roof to support PV is not deductible as part of the PV credit.

[Bay ArEA]

I've had several clients say the solar salesmen told them this, one guy got five quotes and they all told him this. When I told him I'm pretty sure the roof costs do not count, and he told the solar guy, the solar guys then told him "We'll pay for the roof replacement, then just increase your bill by the same amount, (prorated for just the area under the solar panels) so then you can say it was all for the solar." Whoa. That seems pretty fishy. The client could plea ignorance, but I doubt that would hold up in an investigation.