2023 Solar Incentives Guide for Gadsden, AL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Gadsden.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Gadsden?
Local Option- Property Tax Exemption for Renewable Energy Faclities
Alabama Power - Residential Heat Pump Loan Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The phrase "solar incentives" includes a range of financial incentives put in place to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Incentives may include things like discounts, cash back or monthly utility bill credits. Some incentives are provided by the federal government, while others are handled by the state of Alabama or by your utility company, county or municipality. Categories of solar incentives include:
- Rebates: Rebates, or cash back after a purchase, are normally given prior to any solar tax credits being calculated. Solar rebates might be provided by your local utility company, by your state or by your county.
- Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar system. Property tax exemptions let you exclude the value that your solar panels add when calculating how much property tax you need to pay on your house.
- Net Metering: You may be able to sign a net metering agreement with your Gadsden utility company that will apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then subtract this value from your utility bill each month.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
Federal Solar Incentives
When someone says "solar incentives," you likely think of federal incentives first. You might have heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a predetermined percentage of the money you spend on your solar system.
The ITC is applied to the total cost of installing a solar system, including the panels themselves as well as equipment, labor and accessories. You can claim this credit for panels installed after January 1, 2006 on a primary or secondary residence that you own, as long as it is located in the United States. The tax credit ranges from 26-30% of total costs depending on when your project was completed. There is no maximum claim amount.
To better understand how the ITC might apply to your situation, speak to your local Gadsden solar panel installer and ask for more information.
The ITC has been renewed and expanded following the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The Clean Energy Credit has increased the current credit up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. After this, the credit percentage will be reduced slightly each year until the program expires in 2035. Starting in 2023, the expansion will also make credits for energy storage systems even easier to claim.
Click here to learn more about the new Inflation Reduction Act. Your local Gadsden solar panel installation expert is the best person to answer your questions regarding the new Clean Energy Credit and how it may apply to you.
State & Local Solar Incentives
Federal solar incentives are not your only option; tax credits, rebates and more are often offered at the local or state level. Some incentives are ongoing, while others are offered for only a limited time. Local solar incentives could come from the Alabama government, or from your specific county or municipality.
Next Steps for Installing Solar in Gadsden
The expanding number of solar incentives available has contributed greatly to the increase in the use of solar power nationwide over the past 15 years. You may receive solar incentives from the Alabama government, the federal government or your local utility company. Getting in touch with your local Gadsden solar panel installer is an excellent first step towards getting all the incentives you qualify for when you switch to solar energy.
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EcoWatch's Gadsden, AL Solar Incentives FAQs
What if I add solar panels to a vacation home, rental property or commercial property? Will I still qualify for incentives?
Many solar incentives apply to a property you own that is located within the United States; most secondary residences fall into this category. Other solar incentives may be available for commercial properties, depending on the details. We recommend talking to your local solar installer and/or tax professional to better understand what incentives apply to your specific situation.
How can I learn if I qualify for solar incentives?
Generally, solar incentives apply to:
- a new solar system
- installed on a property that you own
- within the U.S.
- within the date range specified by a particular incentive.
Specific incentives, including ones handled by the Alabama government or by your county/municipality, could have additional qualifications. Get in touch with your local Gadsden solar installer to discover what incentives your project will qualify for.
What are some of the environmental benefits of switching to solar energy?
You can reduce your carbon footprint by 450 pounds of CO2 a year when you switch to solar panels. This adds up to roughly 9,000 pounds over 20 years. Solar is also a renewable energy source, which means that making the switch reduces the drain on our planet's resources.
When does the federal solar tax credit end?
The Clean Energy Credit (formerly called the federal solar tax credit, or the ITC), is slated to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I use a combination of solar and another type of renewable energy to power my home?
Yes, you can use multiple types of renewable energy to power your home, such as a combination of solar and wind power. You can also use both renewable energy sources and a backup source of non-renewable energy. Be sure to discuss your proposed plan with your local Gadsden solar panel installer, so that you understand what you'll need and what kinds of incentives you might or might not qualify for.
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.