The Solar Investment Tax Credit: Helping Nonprofits and Churches Benefit from Solar Energy

As environmental consciousness and financial responsibility make their way to the forefront of our lives, the nonprofits and churches we support have a unique opportunity to harness solar power for both sustainable energy and increased financial support.

Thanks to a recent change in the tax law, nonprofits now have a reason to get involved in solar power and enjoy significant rewards. This new law allows churches and other nonprofit groups to get a 30% Investment Tax Credit (ITC), a financial incentive that was previously only given to homeowners or businesses. The exciting part? This credit is now available as a direct payment from the IRS, thus presenting a great financial opportunity that can lead to lower electricity costs and more money that can be used for the important missions of nonprofit organizations.

Impact of the Solar ITC
The solar industry has changed a lot since the Solar Investment Tax Credit was introduced. According to SEIA, the solar ITC for homes and businesses has helped the U.S. solar industry grow tremendously since 2006, making it more than 200 times larger. It’s also helped the solar industry grow by about 33% every year for the last ten years, making it one of the most important ways the government encourages clean energy in the United States.

Direct Payment: A Big Deal for Nonprofits
The Direct Payment option from the IRS is a big change that turns the ITC into actual money for nonprofit groups. This means nonprofits can get the credit amount as a direct payment, which gives them more money to work with and makes their financial situation better. Think about it: lower energy costs plus extra money that can be used for important goals like community projects and the things nonprofits are working toward. This is a unique chance for these groups to not only reduce their environmental impact and create positive change, but also to get more financial benefits.

Extra Credits Bring More Savings
What’s even better is that the benefits of going solar don’t stop there. Projects can get up to six extra credits, which could mean nonprofits get back 70% of the cost of their project.

Four of these extra credits are part of the Low-Income Communities Bonus Credit Program, which the IRS talked about on February 13, 2023 (you can read more about it here). Right now, projects can only apply for one of these four bonus credits. So, a project could either get a 10% or 20% bonus credit, depending on if they qualify.

The four bonus credits in the Low-Income Communities Bonus Credit Program are:

  • 10% bonus for projects in low-income areas
  • 10% bonus for projects on Tribal Land
  • 20% bonus for projects as part of a qualified low-income residential project
  • 20% bonus for projects as part of a qualified low-income economic benefit project

There are also two extra 10% credits that can be added together. Projects that qualify can apply for both these bonus credits, along with the 30% main credit and one of the bonus credits from the Low-Income Communities Bonus Credit Program.

The two extra stackable bonus credits are:

Good News for Churches
For churches, this solar energy revolution is really great. First, using solar power helps churches save a lot on electricity, so they have more money to use for helping the community, supporting members, and their spiritual goals. Second, the Direct Payment option makes the ITC into a financial asset that can be used for different things. This not only makes sure the church is financially stable, but it also helps them do more good things, provide help, and make lasting changes.

Taking the First Step
This new law offers such great financial opportunities to nonprofits that it encourages taking direct action. The way to benefit from solar energy has never been clearer. Your nonprofit, church, or community group has a chance to help the environment and save money in the long run, plus get significant financial rewards.

At NATiVE, we’re dedicated to helping nonprofits and churches succeed with solar energy. We’ve teamed up with RE-volv to assist nonprofits in underserved areas of Texas with going solar. Our experts know all about the ins and outs of solar energy incentives and can give you all the information you need to make the right choice. With our help, you, your church, or your favorite nonprofit can go through the process easily and make sure you get all the benefits of solar power, as well as the financial help your group deserves.

Embrace the power of the sun and start on a journey to a more sustainable and prosperous future. Contact NATiVE Solar below to learn more about how your nonprofit or church can make the most of this amazing opportunity. Together, we can all enjoy the advantages of using more solar energy in Texas!