The tax credit for battery storage systems in the United States has evolved over time. Here’s a breakdown of how the credit amount changes:
- Before 2020: Initially, the Residential Clean Energy Tax Credit was set at 30% for property placed in service between December 31, 2016, and before January 1, 2020.
- 2020-2021: The credit rate transitioned to 26% for property placed in service between December 31, 2019, and before January 1, 2022.
- 2022-2032: Following the Inflation Reduction Act of 2022, the credit for solar and battery storage systems increased back to 30% for installations placed in service after December 31, 2021, and before January 1, 2033.
- 2033: The credit will decrease to 26% for property placed in service after December 31, 2032, and before January 1, 2034.
- 2034: The credit will further decrease to 22% for property placed in service after December 31, 2033, and before January 1, 2035.
To qualify, the battery storage system must have a capacity of at least 3 kilowatt-hours and be installed in a dwelling unit in the United States used as a residence by the taxpayer.
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