STRATEGY IN ACTION: MEET JOHN
John earns $1,000,000 in 1099 income from his business in 2025 and faces a $400,000 tax obligation (estimated 40% federal/state tax rate).
To reduce his taxes, John purchases 29 solar carports at $35,000 each, for an approximate cost of $1,000,000. He contributes $203,000 (20%) as his initial investment, with the remaining 80% financed through a third-party loan.
Under Section 179, his depreciable basis is 75% of his purchase price, resulting in $750,000 in depreciation, resulting in an adjusted taxable income of $250,000.
John qualifies for a 50% Investment Tax Credit (ITC) of $500,000. He transfers most of this credit ($450,000) to Wilson Hand to make arrangements to the third party to pay down his loan balance. John keeps the remaining $50,000 to pay down his tax obligation.
Through this strategy, John reduces his tax obligation by $350,000, resulting in a net cash benefit of $147,000.
