The Solar Tax Credit program, like other federally-sponsored tax credit programs, is a government sponsored initiative designed to encourage taxpayers to help finance solar projects.
Tax credits provide a dollar-for-dollar reduction of a taxpayer’s income tax liability by repurposing tax payment reserves into qualifying tax credit projects.
By investing in a qualified project, the tax credit investor receives tax credits, project cash flows and an exit payment.
Tax credit investors take primarily program compliance risk (as opposed to underlying performance risk) and generate a return on the funds they otherwise would have used to satisfy their tax liabilities.
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