2024 Solar Incentives Guide for Trussville, AL - Tax Credits & Rebates

What Solar Tax Credits, Incentives, and Rebates are Available in Trussville?

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The phrase "solar incentives" refers to a range of financial incentives implemented 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 credit towards your monthly utility bill. Some incentives are handled federally, while others are offered by the Alabama government or by your specific utility company, county or municipality. Some solar incentives you might qualify for are:

• Rebates: Your solar installer might help you claim a rebate, or partial refund after purchase, for your solar system. Counties or states will also offer limited-time rebates at various times. If you receive a rebate, that amount will usually come off your total price before tax credits are calculated.
• Tax Exemptions: Tax exemptions can come in one of two forms. The first is sales tax exemption, applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to ignore the added value of your solar system when calculating property tax for your house.
• Net Metering: Net metering becomes relevant after your solar system is up and running. If you have a net metering agreement with your Trussville utility company, the company will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some areas, this is a dollar-for-dollar credit, while in other places you might receive a refund equivalent to a percentage of the value.
• Tax Credits: Tax credits reduce, dollar-for-dollar, the total amount of tax you owe the federal government. Tax credits differ from tax deductions.

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Federal Solar Incentives

When people think of solar incentives, federal incentives may be the first thing that comes to mind. 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 certain percentage of your solar system's cost.

The ITC can be applied to the total cost of installing solar panels, including the panels themselves as well as accessories, labor and equipment. This credit can be claimed for panels installed after January 1, 2006, on a primary or secondary residence that you own and that is located in the United States. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum claim amount.

Your local Trussville solar panel installation expert can give you more information about the ITC and how it might apply to your situation.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, 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 each year until the current program ends. Starting in 2023, it will also be easier to claim credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit applies to you, talk to your local Trussville solar installers.

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. Some incentives are ongoing, while others are offered for only a limited time. Your local solar incentives may come from the Alabama government, or from your specific county or municipality.

Next Steps for Installing Solar in Trussville

The nationwide use of solar energy has gone up tremendously in the last 15 years, in part thanks to the proliferation of solar incentives. You might receive these incentives from the Alabama government, the federal government or your local utility company. If you're prepared to make the change to solar energy, getting in touch with your local Trussville solar panel installation expert is an excellent place to start.