2024 Solar Incentives Guide for Muscle Shoals, AL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Muscle Shoals.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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What Solar Tax Credits, Incentives, and Rebates are Available in Muscle Shoals?
Local Option- Property Tax Exemption for Renewable Energy Faclities
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are meant to encourage people to switch to renewable energy by providing incentives that lower the financial burden of solar panel installation and use. Solar incentives could include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are provided by the federal government, some by the Alabama government and some by your specific utility company, county or municipality. Categories of solar incentives include:
- Tax Exemptions: These could come in the form of property tax exemptions, which can let you ignore the value of your solar system when paying taxes on your house. You may also qualify for an exemption on sales tax at the time of purchase.
- Net Metering: You can sign a net metering agreement with your Muscle Shoals utility company. This agreement 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 Credits: Tax credits decrease, dollar-for-dollar, how much income tax you owe the government. Tax credits differ from tax deductions.
- Rebates: Rebates, or partial refunds after a purchase, are normally given before any solar tax credits are calculated. Solar rebates can be given by your local utility company, by your county or by your state.
Best National Provider
SunPower
- Most efficient panels on the market
- National coverage
- Cradle to Cradle sustainability certification
- Great warranty coverage
- Expensive
- Customer service varies by local dealer
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some knowledge of. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a predetermined percentage of your solar system's cost.
The ITC initially applied to 30% of the cost of solar panel installation, although that number has fluctuated slightly over time between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total installation cost includes the panels themselves as well as the cost of accessories, equipment and labor. There is no maximum amount you can claim. 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 understand exactly how much the ITC could save you, contact your local Muscle Shoals solar panel installer.
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 lasts until 2035. Any solar installation project that is completed between January 1, 2022, and December 31, 2032, may qualify for a 30% tax credit. This amount will then decrease slightly on a yearly basis until the end of the current program. The expansion to the program also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.
Click here to learn more about the new Inflation Reduction Act. Your local Muscle Shoals solar panel installer can answer any questions you have and explain how the new Clean Energy Credit will apply to you.
State & Local Solar Incentives
Not all solar incentives are federal; tax credits, rebates and more are often offered at the local or state level. Incentives might be provided by your county or municipality, or by the state of Alabama. Some incentives are available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Muscle Shoals
Solar incentives can be offered by the federal government, the Alabama government or your local utility company. The growing number of available solar incentives has facilitated the nationwide growth of solar energy use in the last 15 years. If you're ready to switch over to solar energy, getting in touch with your local Muscle Shoals solar panel installation expert is a great first step.
EcoWatch's Muscle Shoals, AL Solar Incentives FAQs
If my house already has solar panels, can I still claim incentives?
An excellent idea would be to talk to someone from the company that installed your solar system – or reach out to a local Muscle Shoals solar installer — to better understand which incentives you might qualify for. If your solar panels were installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
Who installs solar panels near me?
To find a top-rated solar panel installer, check out our guide to Muscle Shoals' best solar panel companies.
What are some environmental benefits of installing solar panels on my home?
Solar energy is renewable — by switching where you get your energy, you help lessen the strain on our planet's resources. A solar system can also reduce the CO2 emissions from your home by 100 pounds a year, or around 2,000 pounds in 20 years.
If I trade in my appliances for ones that can use solar energy, are there any benefits I can claim?
The recently passed Inflation Reduction Act includes provisions for multiple incentives meant to reward homeowners for making eco-friendly upgrades. Some of these incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
Can I claim incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order that incentives will be applied in may vary depending on which incentives you are eligible for but typically yes, you can claim multiple types of incentives for your solar project. Talk with your solar installer or a local tax professional to ensure you are claiming all possible incentives and applying them in the correct order.
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.