Solar developers are using federal tax credits as important aspect of the capital structure needed to complete projects. For qualified solar energy projects, the section 48 Investment Tax Credit (ITC) is a 30% tax credit is available for projects that are placed in service prior to January 1, 2017. This provides the market long-term policy stability that, along with other factors, will likely continue to drive solar development throughout the United States. Through a variety of structures, project sponsors may have the opportunity to "monetize" these credits as part of the overall capital structure if they do not have sufficient tax liability to utilize the credits themselves.
The Renewable Energy Development Support team at Baker Tilly provides stakeholders in solar projects pragmatic solutions to optimizing the investment tax credit on qualifying solar projects. Leveraging in-depth renewable energy specialization and knowledge of tax credits, our team offers solar project stakeholders the following solutions:
- Establish eligible basis for ITC and determination of potential value
- Support determination of ownership structure to facilitate potential monetization of the credit
- Model project cash flow and tax benefits for investors
- Help characterize the system components and schedule of values from vendors prior to execution of contracts
- Perform detailed cost segregation of project assets
- Assist with the preparation of relevant documentation related to claiming the ITC as part of the federal filing process on behalf of project owners
Contact a member of our team to understand how the solar investment tax credit can impact your project.