Do refurbished parts qualify for tax credit?

[1201]

If one buys a refurbished inverter or batteries, eg from signature solar- do they qualify for the 30% tax credit?

 

[timselectric]

Not legally. Because it wouldn't be the first installation of the equipment.
But all that is required for the claim is a receipt. If it doesn't state it as refurbished, the IRS wouldn't know without an investigation.

Disclaimer: I'm not recommending that you should do anything illegal.

 

[1201]

Not legally. Because it wouldn't be the first installation of the equipment.
But all that is required for the claim is a receipt. If it doesn't state it as refurbished, the IRS wouldn't know without an investigation.

Disclaimer: I'm not recommending that you should do anything illegal.

Thanks for that info Tim.

 

[HRTKD]

Echoing what Tim said, it has to be new or the first install of the equipment.

Also there is this from IRS Form 5695.

Manufacturer’s certification.

For purposes of taking the credit, you can rely on the manufacturer’s certification, in writing, that a product is qualifying property for the credit. Don't attach the certification to your return. Keep it for your records.

 

[DrZ123]

Slightly different topic but couldn't find an answer.

For a solar setup in an off-grid home with no option for grid tied electric, can I still claim tax credits?

 

[1201]

Slightly different topic but couldn't find an answer.

For a solar setup in an off-grid home with no option for grid tied electric, can I still claim tax credits?

Yes. A solar PV system does not necessarily have to be connected to the electric grid for you to claim the residential federal solar tax credit, as long as it is generating electricity for use at your residence

 

[DrZ123]

Okay. Thank you! And if I buy equipment that is new but from someone who bought it who hasn't used it, would that qualify?

 

[1201]

Okay. Thank you! And if I buy equipment that is new but from someone who bought it who hasn't used it, would that qualify?

That I don't know.

 

[timselectric]

Okay. Thank you! And if I buy equipment that is new but from someone who bought it who hasn't used it, would that qualify?

If it's never been used. This would be the original installation. So yes, it qualifies.

 

[Supervstech]

If it's never been used. This would be the original installation. So yes, it qualifies.

I'd say if the previous purchaser hasn't claimed it, it should qualify...
Used or not, if it's been claimed, it wouldn't qualify

 

[timselectric]

I'd say if the previous purchaser hasn't claimed it, it should qualify...
Used or not, if it's been claimed, it wouldn't qualify

If it's used, it doesn't qualify.
But, that probably wouldn't stop me from claiming it.

 

[DIYrich]

If it's used, it doesn't qualify.
But, that probably wouldn't stop me from claiming it.

"Used" is not used in the code. "Original installation " is the term. It cannot be easily determined whether a "refurbished" item has or has not been "installed". Looking past the wording, the intent is for one, and only one, credit per item. It can be argued that in order for a product to be "refurbished" it had to have been returned, and either exchanged or refunded. If refunded, it is not eligible for the credit. If exchanged, then the exchanged item is the one qualifying for the credit. So the original item has not had a credit claimed against it.

 

[timselectric]

"Used" is not used in the code. "Original installation " is the term. It cannot be easily determined whether a "refurbished" item has or has not been "installed". Looking past the wording, the intent is for one, and only one, credit per item. It can be argued that in order for a product to be "refurbished" it had to have been returned, and either exchanged or refunded. If refunded, it is not eligible for the credit. If exchanged, then the exchanged item is the one qualifying for the credit. So the original item has not had a credit claimed against it.

It's pretty simple. If it was previously used. This isn't it's original installation. And refurbished wasn't in my reply. But it could be refurbished and the original installation. Depending on the situation that required refurbishment.

 

[justinm001]

Just because a panel is refurbished or even used doesn't mean you know it was installed before.

My understanding of the ruling is unless you know it was installed before you're in the clear. Could have been used for testing or training or something for all you know

 

[timselectric]

It really doesn't matter. I'm sure that many systems have been claimed twice. The IRS doesn't have the manpower to check every single claim.
And if you actually get to be the random audit. You can easily negotiate to only pay back a percentage.
You just have to decide what risk level is acceptable for you.

 

[DrZ123]

I have some batteries new in box so those are easily claimed as new. I have the invoice for the original purchase as well.

So if I install $30,000 of equipment I should be able to claim 1/3 of that in tax credit?

 

[timselectric]

Almost 1/3.
I believe it's 30%.

 

[42OhmsPA]

I have some batteries new in box so those are easily claimed as new. I have the invoice for the original purchase as well.

So if I install $30,000 of equipment I should be able to claim 1/3 of that in tax credit?

30,000*.3=9,000

 

[DrZ123]

And can you do that continuously as you add more equipment or just on initial install?

 

[timselectric]

As you add.