The commercial system benefits are a true financial windfall for any business with a good solar location and mounting area that can take advantage of the tax incentives. In addition to a possible rebate from your power company (funded by the state), there is a 30% federal tax credit and a 6 year depreciation on the system. This means you have the option of building a system to basically eliminate your electric bill with an amazing 6 to ten year payback on your investment. The power will be basically cost free for the remaining 20-30 years. Solar module warranties run between 20 and 25 years. Some tax credit details are described below. For a complete professional financial analysis of a photovoltaic system tailored to your business, contact Ericson solar at 530-626-5497 or email us at sunpowerr@sbcglobal.net

In addition to the above tax credit provisions, Section 168 of the Internal Revenue Code contains a Modified Accelerated Cost Recovery System (MACRS) by which businesses can recover investments in solar, wind, and geothermal property through depreciation deductions. The MACRS establishes a set of class lives for most property, ranging from three to 31.5 years, over which the property may be depreciated. For property placed in service after 1986, the current MACRS class life for applicable renewable energy technologies is five years. The basis for the depreciation is 95% of the net system cost after rebates. In California, non-incorporated businesses may use the 5-year depreciation schedule. Corporations must use a 12 year class life recovery period. The one-time Special Depreciation Allowance of 50% of the depreciation basis applies to property depreciable under MACRS, and was enacted in 2001. In 2002 the special allowance was increased to 50%.

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