Government and Tax Benefits

TAKE ADVANTAGE OF SOLAR ENERGY TAX BREAKS

LEARN ABOUT THE TAX BENEFITS OF SOLAR PANELS IN SOUTH CAROLINA

HOW TO CLAIM YOUR FEDERAL TAX CREDIT

YOU WILL NEED FORM 5695

Download Form 5695 at: https://www.irs.gov/pub/irs-pdf/f5695.pdf

1. On line 1, fill in the cost of your system as it is listed on your final invoice.
2. Fill in line 5 and 6. Line 6 line should match the amount of your federal tax credit as it was listed on your proposal.
3. Fill in any other parts of the form if you have additional residential energy credits for which to apply.
4. Fill in line 16 if you don’t have the entire tax liability this year & want some to roll over to next year.
5. On page 2, line 17a, select “Yes” then fill in your address on line 17b. Select “No” for 17c.
6. File this form with your federal taxes.

HOW TO CLAIM YOUR SC STATE TAX CREDIT

FORMS TC-38 AND SC1040TC

Download the two forms you need:

TC-38: https://dor.sc.gov/forms-site/Forms/TC38.pdf 

1040TC: https://dor.sc.gov/forms-site/Forms/SC1040TC_2022.pdf

1. 
   On the TC-38 form under the section for “Type of System Installed,” you should select the first box for solar power system. Note that solar power systems that are interconnected are already deemed certified by the utility, you do not need the SRCC form.
2. On line 1 Include the full cost of what you paid for its installation under the heading for “Installation of Solar Energy Credit Computation.” 
3. Appy the credit on line 2 by multiplying line 1 by 0.25.
4. Line 3 is used for systems installed in previous years and the credit is carried forward.
5. Lines 4-10 are used as a calculator to figure the max you can claim this year.
6. Line 10 will give you the amount for your credit this year, and line 11 is the difference (if there is one). If there is a carryover, you would use the number in line 11 for next year's line 3.
7. On Form SC1040TC, you can add the tax credit to the list of other credits. Write in line 6 "Solar Energy System Credit" and the code is "38."