2024 Solar Incentives Guide for Athens, AL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Athens.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Athens?
Local Option- Property Tax Exemption for Renewable Energy Faclities
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are designed to mitigate the cost of installing solar panels on your home. This category of financial incentives is in place to encourage more Americans to switch to renewable energy. You may qualify for various types of incentives, including cash back, discounts or monthly utility bill credits, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the Alabama government and others from the federal government. Categories of solar incentives include:
- Tax Credits: Tax credits reduce, dollar-for-dollar, the total amount of tax you owe the government. These are different from tax deductions.
- Rebates: Rebates, or partial refunds after a purchase, are usually applied before any solar tax credits are calculated. These rebates can be provided by your local utility company, by your county or by your state.
- Net Metering: You may be able to sign a net metering agreement with your Athens utility company, that may apply to all or a percentage of the excess electricity your solar panels generate. They will then deduct this value from your monthly utility bill.
- Tax Exemptions: These might come in the form of property tax exemptions, which can let you exclude the value of your solar system when paying taxes on your home. They may also include exemptions on sales tax at the time of purchase.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some familiarity with. A federal incentive that most people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a given percentage of the cost of your solar system.
The ITC was originally for 30% of the total cost of solar panel installation, although it has fluctuated slightly over the years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total installation cost includes the panels themselves as well as the cost of equipment, accessories and labor. There is no maximum claim amount. The ITC applies to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be in the United States and owned by you.
To best understand how the ITC will apply to your situation, get in touch with your local Athens solar panel installer and ask for more information.
In August 2022, the ITC (now titled the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. For solar system installations that begin after January 1, 2022, and are completed by the end of 2032, homeowners can receive a credit for 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit expires in 2035. The program expansion also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.
More information about the new Inflation Reduction Act can be found here. The best way to fully understand how the new Clean Energy Credit will apply to you is to reach out to your local Athens solar panel company with your questions.
State & Local Solar Incentives
There are more than just federal solar incentives; rebates, tax credits and more are often offered at the local or state level. Some incentives are ongoing, while others might only be available for a limited time. Incentives might be provided by the Alabama government, or by your county or municipality.
Next Steps for Installing Solar in Athens
There are a number of different solar incentives: those provided by local utility companies, those offered by the Alabama government and those offered by the federal government, to name a few. The use of solar energy has grown tremendously in the last 15 years, partially due to these incentives. It is a good idea to talk to your local Athens solar installer to learn more about these incentives and to be sure that you're getting the most money possible for your solar system.
EcoWatch's Athens, AL Solar Incentives FAQs
What are the top solar panel installation companies near me?
To find the right solar panel installer for you, check out our guide to the best solar companies in Athens.
When does the federal solar tax credit end?
The federal solar tax credit, formerly called the ITC and now titled the Clean Energy Credit, is set to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
I want to switch my appliances out for ones that are more energy-efficient. Are there any incentives I can apply for?
The new Inflation Reduction Act creates a number of new financial incentives that are available when you make eco-friendly improvements to your home. More details about these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I claim incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can receive both tax credits and rebates towards the cost of your solar panels. Depending on precisely which incentives you are claiming, they may apply in a different order. Make sure that you talk to your solar installer or a local tax professional to ensure that you are claiming incentives correctly and that you're getting the most money possible.
What if I am planning to add a solar system to a rental property, vacation home or commercial property? Can I still qualify for incentives?
Many solar incentives apply to a property located within the United States that you own, and most secondary residences will fall into this category. There may be other solar incentives available for commercial properties, depending on the details. We recommend speaking with your local solar installer and/or tax professional to better understand what incentives apply to your specific situation.
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.