Not as much as you may think. Our turn-key process allows you to due diligence and purchase solar projects available all over the United States and utilize operations and maintenance providers to help oversee your solar assets. They are experts in the solar field and will handle the things you cant' or don't want to do.

If you desire to use the depreciation and tax credits solar provides to offset tax on (w-2) earnings or income from another business, the IRS regulation requires 100 hours or more of active/material participation in your solar business to take advantage of this benefit.  We will guide you in completing this process. Our goal is to make this as seamless and effortless as possible.  

**If you are seeking to offset tax on passive income or C Corp Income, ZERO active/material participation is required.

Material participation refers to the level of active involvement an individual has in a business or investment activity, often determining eligibility for certain tax benefits or deductions based on specific criteria set by tax authorities.

We provide you with a highly experienced and nationally capable solar vendors and O&M providers. 

No. You choose when to purchase solar assets and how much. 

Just let us know that you are ready to start looking at solar project purchase opportunities. We offer a turnkey business launch and will begin sharing solar projects that you can originate/acquire within your new solar business.

We will of course consult with you to ensure you understand the acquisition & management process for each solar asset we identify and share with you.

There are multiple ways to exit the business.

Short term options include donation of the panels and future cash flow to a qualified 501c3, long term triple net service agreements, or sale to a 3rd party as early as year 6. 

Other options include, holding it for as long as you desire. The asset will produce positive cash flow for up to 40 years with a 2.99% annual increase in revenue.

There are multiple ways to exit the business.

Short term options include donation of the panels and future cash flow to a qualified 501c3 or sale to a 3rd party as early as year 6. We do not recommend selling the asset due to the recapture of depreciation required. We will introduce you to charitable organizations that will accept your donation when you are ready to exit.

Other options include, holding it for as long as you desire. The building owner signs a 25 year power purchase agreement that includes two automatic 5 year extensions. It will produce high quality energy for at least 35 years which correlates to cash flow to you annually.

A contract between a producer of electricity (You, the solar business owner) and a customer (A Building owner that desires more cost efficient electricity), stipulating terms for the sale and purchase of electricity over a predetermined period, typically at specified rates and quantities.

An ITC Tax Credit, or Investment Tax Credit, is a tax incentive provided by the federal government for qualified investments, such as renewable energy systems (solar) or energy-efficient equipment. When purchased, between 30% and 60% tax credit is provided to the purchaser to use against their federal tax liability.

Depreciation can be used to reduce taxable income. It will reduce taxable, adjusted gross income by $1 per $1 of depreciation, thereby saving an individual up to .52 cents on each dollar.

This is a specific depreciation schedule set by the federal government for 5.5 years. Currently the federal government allows for “bonus depreciation” to be taken in year one. This accelerates the 5.5 year schedule.

Example: The 2024 Bonus Depreciation allowed in year 1 is 60%. Therefore one can take 60% of the total 5.5 year depreciation schedule in 2024 PLUS the first year % of MACRS. This equals 64% of the total depreciation value.

As much or as little as you desire, however, we will run an analysis to determine the optimal purchase amount for your specific needs. Your purchase amount is dependent on what your current year tax liability will be and how much tax refund you would like to retrieve from prior years tax paid.

This depends on your current tax liability and tax brackets. For example, California residents will save more than Florida residents due to their potential 14.3% state income tax vs Florida’s ZERO state income tax.

The tax benefit ranges between $1.30 to $1.65 of savings for every $1.00 spent in solar. CA residents will receive the higher end of the savings vs states with ZERO or lower income tax rates.

There is also an opportunity to purchase excess solar tax credits at a discounted price. These excess tax credits may be carried back up to 3 years for a refund on previous federal tax paid.

Yes!! You can use excess solar tax credits acquired in the year of purchase and carry them back up to 3 years for a refund on federal income tax paid. This is allowable up to 75% of the amount of tax paid.

In most cases you can purchase a $1 tax refund for significantly less than $1. How much tax refund would you like to receive?

Tax Credit received and depreciation available from a solar asset purchase will offset “ANY & ALL” taxable income, so long as 100 hours of active/material participation is completed in the year of acquisition. (see material participation FAQ)

Zero material participation is needed for tax credit and depreciation to offset passive income.

$1 dollar of tax credit will fully offset $1 federal tax liability.
Also note, there is a limit to the amount of Investment Tax Credit (ITC) that can be applied against your current year federal tax due. This number ranges from 60% to 70% of your total federal tax liability depending on a few variables.

Any unused tax credit in the year of acquisition, may be carried forward up to 22 years OR carried backward for a refund on federal taxes paid up to 3 years in the past. (Creating a very POWERFUL opportunity!)

Every $1 of depreciation will offset $1 of income you are taxed on, both at the federal level and the state level.

Example: If you have $100,000 of depreciation and $500,000 of adjusted gross income, after you apply the $100,000 of depreciation from solar, you will only be taxed on $400,000 of income.

We will send you project purchase opportunities to review as frequently as projects that fit your needs are available.

The best time to purchase solar is Q1 and Q2, however it is possible to purchase later in the year. We recommend you adjust your withholdings and quarterly tax estimates and purchase solar projects with money you would have otherwise paid in tax.

Example: A $100,000 solar purchase can save you up to $165,000 in tax, $135,000 in the first year, so why over pay in tax? Reduce your payments and keep that money available to purchase new projects.

This will depend on how you structure your solar acquisitions.   Less financing = more cash flow.  More financing = less cash flow.  There are benefits to either method of acquisition.  We will help you evaluate what will be best for you..

This depends on the project, however because you are purchasing the solar projects with money you would have otherwise used to pay tax and receiving a greater tax benefit than cash infusion, your ROI is arguably infinite.  The only other option is to write a check to the federal or state government.  In a properly structured acquisition, you will convert your tax liability into profit.

Accepting financing is not required. It is completely fine for purchasers to pay 100% cash for the projects acquired.

If you do accept seller financing, the energy payment made by the building owner will cover your annual operations & maintenance fees, your loan payment and will also provide you with positive cash flow quarterly.

Specific to your financing, it is important to be in an “at risk” position to benefit from the additional value the tax credit and depreciation received at the higher, leveraged purchase price, however you may or may not need to personally gaurantee the loan, depending on the provider and structure you utilize. 

It is based on Long Term AFR, which has been hovering between 3% and 4.5% for the past 2 years.   The interest rate is fixed for up to a 40 year period.  It can be adjusted to accomodate an initial 6 year interest only period, then switch to amortizing from year 7 to 40. 

The management company that provided you with the loan is in a financial position that allows them to defer your loan payments until energy payments are made. It is viable for this to occur for a number of months or even years until the customer is caught up.

In the worst case scenario, a new building owner or tenant of the building will begin making energy payments under a new Power Purchase or Master Lease Agreement. This will continue to cover your annual O&M expense, loan payments and provide you with positive cash flow.

No, not before the end of an initial 8 year term.

No. This is a private loan that does not require underwriting and does not show up on your personal credit report.

One of the three layers of insurance that are included in your annual O&M fees will be utilized to cover the cost.

Yes they are typically warrantied for up to 40 years.

A new building owner or tenant of the building or business operator will begin making energy payments under a new Power Purchase or Master Lease Agreement. 

You would simply acquire a new O&M provider, similar to property management in real estate. With solar being one of the fastest growing industries in America, there are more and more options to choose from in the marketplace.

Yes

Yes, you may sell your solar assets.  You are in full control as the solar business owner.  You may also hold or donate your solar assets.

Yes