2023 Solar Incentives Guide for Orange Beach, AL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Orange Beach.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Orange Beach?
Wood-Burning Heating System Deduction
Local Option- Property Tax Exemption for Renewable Energy Faclities
Federal Residential Renewable Energy Tax Credit
Solar incentives are designed to encourage homeowners to switch to renewable energy by providing incentives that lower the financial burden of solar panel installation and use. You may be eligible for different kinds of incentives, including cash back, discounts or credit towards your monthly utility bill, 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. Some solar incentives you might qualify for are:
- Tax Exemptions: Tax exemptions can come in two forms. First, there is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption, which allows you to ignore the value added by your solar system when paying property tax on your house.
- Tax Credits: Tax credits decrease, dollar-for-dollar, the amount of income tax you owe the federal government. These are different from tax deductions.
- Rebates: A solar rebate is a partial refund after the purchase of your solar system. Rebates could be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
- Net Metering: Net metering is an incentive you can get once your solar system is up and running. If you've signed a net metering agreement with your Orange Beach utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in other areas you might receive a refund equivalent to a percentage of the value.
Federal Solar Incentives
Federal solar incentives are likely to be the first thing that comes to mind when you think about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC provides a tax credit for a specific percentage of the cost of your solar system.
The ITC can be applied to the total cost of solar system installation, including the panels themselves as well as labor, accessories and equipment. This credit can be claimed 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 best understand how the ITC will apply to your situation, get in touch with your local Orange Beach solar panel installation expert and request more information.
In August 2022, the ITC (now titled the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. The Clean Energy Credit runs until 2035. Any solar installation project that is completed between January 1, 2022 and December 31, 2032 may qualify for a 30% tax credit. The amount will decrease slightly each year until the end of the current program. Beginning in 2023, it will also be easier to qualify for credits for energy storage systems under this new program.
More information about the new Inflation Reduction Act can be found here. Your local Orange Beach solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it will apply to you.
State & Local Solar Incentives
Tax credits, rebates and more can be provided at multiple levels. Along with federal solar incentives, there are often state and local ones as well. The incentives — which might be given by your county or municipality, or by the state of Alabama — may be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Orange Beach
Nationwide solar energy use has increased enormously in the past 15 years, in part thanks to the proliferation of solar incentives. You can obtain these incentives from the federal government, the Alabama government or your local utility company. Your local Orange Beach solar panel installation company can give you more information about which incentives you should apply for, and get you feeling good about making the change to renewable energy today.
EcoWatch's Orange Beach, AL Solar Incentives FAQs
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