To be eligible for the battery storage tax credits, the following criteria must be met:
Eligibility Criteria
- Capacity: The battery storage system must have a capacity of at least 3 kilowatt-hours (kWh) to qualify for the tax credit.
- Residence Requirement: The battery storage must be installed in a dwelling unit located in the United States that serves as a residence for the taxpayer. This includes principal residences, second homes, but excludes rental properties unless the taxpayer uses it as a personal residence for part of the year.
- Installation Period: The system must be installed and placed in service after December 31, 2021, and before January 1, 2033, to qualify for the 30% tax credit.
- New Equipment: Only new and previously unused battery storage technology qualifies for the tax credit.
- Eligible Costs: Labor costs associated with installation, as well as costs for onsite preparation, assembly, and necessary piping and wiring, are eligible for the tax credit.
- Tax Credit Rate: The tax credit rate varies but is currently set at 30% for qualifying systems installed between 2022 and 2032.
Claiming the Credit
To claim the tax credit, homeowners need to fill out IRS Form 5695. This form is used for reporting residential energy credits.
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