When you invest into a solar system, you may receive solar tax credits and possible local and state incentives. These credits and incentives can be pocketed, or help pay for the cost of your solar loan. The federal solar tax credit, also known as the investment tax credit (ITC), allows you to credit 26% of the cost of a solar energy system. The ITC applies to both residential and commercial systems, and there is no cap on its value. This solar credit will be reduced at the end of 2020, so make sure to invest while you can still receive these incentives.