Do refurbished parts qualify for tax credit?

[42OhmsPA]

Federal Tax Credits for Upgrades

I trust my tax accountant more than some person on the internet with strong opinions.

diysolarforum.com

 

[JWLV]

You can probably even add those solar garden lights that you can buy at Walmart. Just bundle it all in together with all of your other solar equipment.

 

[chrisski]

You need to pay taxes to be able to claim this credit. Few in the US would be able to claim the full credit in a single year.

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

Do recommend you talk to a tax advisor when taking the credit. Use our “educated” comments to help out.

 

[justinm001]

It's 30% and includes installation costs. If installing yourself can you charge yourself 50k to install the 30k in equipment ?‍. Instead of 9k that be 24k refund. Just get a free quote from one of the solar inser companies and use their price to get a reasonable cost.

The tax law is open to a lot of interpretation.

We're not tax attorneys so just lole @chrisski said use our advice as a guide.

 

[Solar Guppy]

If installing yourself can you charge yourself 50k to install the 30k in equipment

Nope, that won't work with the IRS

 

[timselectric]

You can claim anything you want.
But if audited, you will have to provide receipts.

 

[DIYrich]

It's 30% and includes installation costs. If installing yourself can you charge yourself 50k to install the 30k in equipment ?‍. Instead of 9k that be 24k refund. Just get a free quote from one of the solar inser companies and use their price to get a reasonable cost.

The tax law is open to a lot of interpretation.

We're not tax attorneys so just lole @chrisski said use our advice as a guide.

If you really belive what you wrote, pm me your name and address so I can collect the whistle blower reward. I'll pay for your audit defense if you win.

 

[1201]

Hey the electrical engineer creating my sld says that if I build a carport (solar support structure) I can claim it?

 

[justinm001]

If you really belive what you wrote, pm me your name and address so I can collect the whistle blower reward. I'll pay for your audit defense if you win.

Whats the difference between paying a solar install company and paying a company you created and used to bill yourself for the work? Provided the work isn't above average cost of installation?

Maybe I missed that in the solar ruling that you can't be an employee of the company who's installing

 

[timselectric]

Hey the electrical engineer creating my sld says that if I build a carport (solar support structure) I can claim it?

If it's built for the purpose of supporting the solar array. I don't see why not.
Just because it can be used for other purposes shouldn't be a problem.

 

[1201]

Whats the difference between paying a solar install company and paying a company you created and used to bill yourself for the work? Provided the work isn't above average cost of installation?

Maybe I missed that in the solar ruling that you can't be an employee of the company who's installing

The govt might have a problem with you creating a company for the sole purpose of claiming a credit, maybe

 

[DIYrich]

Whats the difference between paying a solar install company and paying a company you created and used to bill yourself for the work? Provided the work isn't above average cost of installation?

Maybe I missed that in the solar ruling that you can't be an employee of the company who's installing

You didn't say you would run the payment through a company. You will pay more in income, unemployment, and FICA taxes than the 30% tax credit.

 

[justinm001]

The govt might have a problem with you creating a company for the sole purpose of claiming a credit, maybe

Nope they sure don't. Happens ALL the time with the Section 179 (hummer tax loophole). In fact most expensive vehicles (boats, RVs, planes, supercars) are usually LLCs for the sole purpose for claiming deductions/credits.

The IRS laws are designed with tons of loopholes for wealthy to skip out in paying taxes.

 

[timselectric]

There are many ways to do things.
I haven't claimed any tax credits for my system.
Instead, it has all been purchased by my company. It's all deducted from my profits. (Product testing and employee training)

 

[justinm001]

You didn't say you would run the payment through a company. You will pay more in income, unemployment, and FICA taxes than the 30% tax credit.

I said "charge yourself" which was implied payment through a company. Take the example above 30k materials and 50k labor = 80k total income - 30k costs = 50k profit. You can either shut the company down and pay a 15% cap gains tax on the 50k ($7,500) which is exempt from self employment taxes or offset that 50k profit with other business related deductions.

You personally are getting a 24k credit from the IRS which isn't taxed and your business now has a 50k profit and you can deduct all kinds of things for business use.

 

[DIYrich]

I said "charge yourself" which was implied payment through a company. Take the example above 30k materials and 50k labor = 80k total income - 30k costs = 50k profit. You can either shut the company down and pay a 15% cap gains tax on the 50k ($7,500) which is exempt from self employment taxes or offset that 50k profit with other business related deductions.

You personally are getting a 24k credit from the IRS which isn't taxed and your business now has a 50k profit and you can deduct all kinds of things for business use.

"Charge yourself" implies creating a receipt, but not actually running it through a company. Typical novice attempt at fraud. "Pay your own company to install" is running it through your own company.

50k labor does not equal 50k profit. You forgot that the irs is keen on making sure owners of a company pay themselves a fair wage. Lots of audits of s and c corps on that issue.

Like I said, people should not be taking tax advice from a non-tax forum.

 

[justinm001]

"Charge yourself" implies creating a receipt, but not actually running it through a company. Typical novice attempt at fraud. "Pay your own company to install" is running it through your own company.

50k labor does not equal 50k profit. You forgot that the irs is keen on making sure owners of a company pay themselves a fair wage. Lots of audits of s and c corps on that issue.

Apparently should have explained what charge yourself means, my bad. Not sure how you'll create a receipt without a company though.

For 50k profit you don't need to pay yourself but if you're dead set on making sure to comply with every possible aspect then sure you can pay yourself minimum wage for the hours you spent installing the solar. But its very very normal to not pay yourself for a company that doesn't make enough profit or one that didn't get off the runway.

BTW the "fair wage" ruling is to help prevent CEO's getting paid salaries of $1 then 8 figure stock options annually. This is another loophole as they'll take loans against their assets (corporate stock ownership) which loans are not income thus not taxed. They can spend billions tax free because the 15% cap gains loophole wasn't good enough. Now they just pay themselves a measly couple million a year and pay taxes on that while still spending billions tax free.

None of this is fraud or even remotely wrong. Its just taking advantages of all the IRS and business tax rulings and laws designed to be used. Its a broken system designed to help the rich and tax the poor. They make tax laws complicated and hard to figure out on purpose because many don't have tax professionals and attorneys to help interpret the laws.

So to break it down a bit more instead of 50k profit its 49k profit and 1k payroll which you'll spend a couple hundred in taxes...maybe.


I implore you to watch the movie the accountant (ben affleck and anna kendrick) in the first few minutes he explains business deductions to an old lady about making beads. All of it legit but also the IRS is cracking down on those filing home office deductions so huge red flag although legal. Plus its an amazing movie

 

[DIYrich]

Apparently should have explained what charge yourself means, my bad. Not sure how you'll create a receipt without a company though.

For 50k profit you don't need to pay yourself but if you're dead set on making sure to comply with every possible aspect then sure you can pay yourself minimum wage for the hours you spent installing the solar. But its very very normal to not pay yourself for a company that doesn't make enough profit or one that didn't get off the runway.

BTW the "fair wage" ruling is to help prevent CEO's getting paid salaries of $1 then 8 figure stock options annually. This is another loophole as they'll take loans against their assets (corporate stock ownership) which loans are not income thus not taxed. They can spend billions tax free because the 15% cap gains loophole wasn't good enough. Now they just pay themselves a measly couple million a year and pay taxes on that while still spending billions tax free.

None of this is fraud or even remotely wrong. Its just taking advantages of all the IRS and business tax rulings and laws designed to be used. Its a broken system designed to help the rich and tax the poor. They make tax laws complicated and hard to figure out on purpose because many don't have tax professionals and attorneys to help interpret the laws.

So to break it down a bit more instead of 50k profit its 49k profit and 1k payroll which you'll spend a couple hundred in taxes...maybe.


I implore you to watch the movie the accountant (ben affleck and anna kendrick) in the first few minutes he explains business deductions to an old lady about making beads. All of it legit but also the IRS is cracking down on those filing home office deductions so huge red flag although legal. Plus its an amazing movie

Have fun if your return is ever audited.

 

[JWLV]

It's 30% and includes installation costs. If installing yourself can you charge yourself 50k to install the 30k in equipment ?‍. Instead of 9k that be 24k refund. Just get a free quote from one of the solar inser companies and use their price to get a reasonable cost.

If you pay yourself $50k to install, that $50k must be reported as income. Saving an expense does not mean you can claim it as an expense to get the tax credit from it. If you did pay yourself $50k, then you'll end up paying even more in taxes than the 30% credit you receive.

 

[Supervstech]

If you pay yourself $50k to install, that $50k must be reported as income. Saving an expense does not mean you can claim it as an expense to get the tax credit from it. If you did pay yourself $50k, then you'll end up paying even more in taxes than the 30% credit you receive.

Nah nah nah...
Ya just CLAIM ya spent the 50K... it's up to the IRS to verify it and see where the money went...

Um...
Yup, I read it on the internet...