Solar Panels on a rental property

[GTS1101]

I have a client that owns two homes on the same land. The home in the front is her personal residence. The home in the back is being rented out. She purchased solar panels and they were installed on the home being rented out in the back because it had more exposure to the light. The back home is tied into the front home so that the front home also uses the solar power generated from the panels on the back home. Does she get a partial credit for the solar installed since her personal residence is benefiting from the panels too or does it all have to be depreciated against the rental for 27.5 years?

Thank You!
GTS1101

[AZ-Tax]

Being on the subject of Solar, does Solar screens qualify?

Being on the subject of Solar, does Solar screens qualify for an energy tax credit on residential property. My research tells me no but one of you may know different.

[taxea]

she gets the full credit because she owns the rental.

[spanel]

she gets the full credit because she owns the rental.

Think you might want to pop open TTB page 11-15. (no rentals).

Chris

[taxea]

Think you might want to pop open TTB page 11-15. (no rentals).

Chris

The rental is connected to the main home and the roof of the rental was used because it had more sun. If there are two meters then I am assuming that the PV was connected to the meter for her residence. I will agree that if the PV services both residences the expense for credit has to be allotted between the personal and rental homes.

[spanel]

The rental is connected to the main home and the roof of the rental was used because it had more sun. If there are two meters then I am assuming that the PV was connected to the meter for her residence. I will agree that if the PV services both residences the expense for credit has to be allotted between the personal and rental homes.

How exactly is the personal house connected to the solar? There would have to be solar equipment at the personal house. You cant just run a 110v line to the personal house meter and call it a day. My vote is this...

All Equipment and wiring installed at the personal residence is eligible for a solar credit.

All Equipment and wiring at the rental needs to be depreciated.


Chris

[Gretel]

Here are my two cents: It does not matter so much where the panels are located but who is using the energy from it. If taxpayers who are part of shared solar systems (the panels are out in the fields someplace) are eligible to get the credit, I don't see why the expenses could not be prorated for the solar credit. How to prorate is a different question.

[spanel]

Here are my two cents: It does not matter so much where the panels are located but who is using the energy from it. If taxpayers who are part of shared solar systems (the panels are out in the fields someplace) are eligible to get the credit, I don't see why the expenses could not be prorated for the solar credit. How to prorate is a different question.

If the equipment is equally serving both residences, then I would prorate 50/50.

Chris

[taxea]

How exactly is the personal house connected to the solar? There would have to be solar equipment at the personal house. You cant just run a 110v line to the personal house meter and call it a day. My vote is this...

All Equipment and wiring installed at the personal residence is eligible for a solar credit.

All Equipment and wiring at the rental needs to be depreciated.


Chris

yes you can

[spanel]

yes you can

Unless they are running 100% of solar, you needed at minimum grid tie in equipment. If they don't have that at the personal house, how is the 110/220 getting into the main panel?

Chris

[GTS1101]

Thank You!

Thank you all for your thoughts and opinions. I really appreciate all the input. Great conversation on the Solar equipment for her rental property. This is really going to help me decide on how to deduct the solar on her rental property.

GTS1101

[taxea]

How exactly is the personal house connected to the solar? There would have to be solar equipment at the personal house. You cant just run a 110v line to the personal house meter and call it a day. My vote is this...

All Equipment and wiring installed at the personal residence is eligible for a solar credit.

All Equipment and wiring at the rental needs to be depreciated.


Chris

The power line for the solar CAN be run to the main house meter.