2023 Solar Incentives Guide for Alexander, AR - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Alexander.
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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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Alexander?
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Federal Residential Renewable Energy Tax Credit
Solar incentives mitigate the cost of installing a solar panel system on your home. These financial incentives are designed to encourage more Americans to switch their home over 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 provided by the state of Arkansas or 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 allow you to ignore the value added by your solar panels when paying property tax on your home. You could also look for exemptions on sales tax at the time of purchase.
- Net Metering: You can sign a net metering contract with your Alexander utility company, that may apply to all or a percentage of the excess electricity your solar panels generate. Your utility company will then subtract this value from your utility bill each month.
- Rebates: Solar rebates can be provided by your state or county, or by your local utility company. These rebates are essentially partial refunds that are applied after you pay for a solar system and before tax credits are calculated.
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (A tax credit is different from a tax deduction.)
Federal Solar Incentives
When thinking about solar incentives, you probably think of federal incentives first. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a predetermined percentage of the cost of your solar system.
The ITC was originally for 30% of the cost of installing a solar system, although that number has fluctuated slightly over time 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 labor, equipment and accessories. There is no maximum claim amount. The ITC applies to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.
To know exactly how much money the ITC could save you, contact your local Alexander solar panel installer.
The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. Now, solar installation projects begun after January 1, 2022 and finished by December 31, 2032 may be eligible for a 30% tax credit. This percentage will then decrease slightly each year until the end of the current Clean Energy Credit in 2035. The expansion to the program also makes claiming credit for energy storage systems easier than ever before, starting in 2023.
More information about the new Inflation Reduction Act can be found here. The easiest way to understand how the new Clean Energy Credit applies to you is to reach out to your local Alexander solar panel installation expert with your questions.
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 provided by the state of Arkansas, or by your county or municipality — may be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Alexander
The nationwide use of solar energy has increased enormously in the last 15 years, in part due to the proliferation of solar incentives. You might receive these incentives from the federal government, the Arkansas government or your local utility company. Your local Alexander solar panel installation company can provide you with more details about which incentives you might qualify for, and get you feeling good about making the change to renewable energy today.
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EcoWatch's Alexander, AR Solar Incentives FAQs
Can I receive any incentives when I add solar panels to a vacation home, rental property or commercial property?
Many solar incentives apply to a property located within the United States that you own; most secondary residences fall into this category. There may be other solar incentives available for commercial properties, depending on the specifics. We recommend reaching out to your local solar installer and/or tax professional to fully understand what incentives will apply to your specific situation.
How do I learn if I qualify for solar incentives?
Broadly, solar incentives apply to:
- a new solar panel system
- installed on property you own
- within the U.S.
- between the dates specified by a particular incentive.
Specific incentives, including those run by the Arkansas government or by your county/municipality, could have additional qualifications. Get in touch with your local Alexander solar installer to learn more about what incentives your project may qualify for.
My home already has solar panels. Do I qualify for any incentives?
You should plan to talk to the company that installed your solar panels — or call a local Alexander solar installer — to better understand which incentives you may qualify for. If your system was installed after January 1, 2022, you likely qualify for the recently increased 30% tax credit under the Inflation Reduction Act. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
How much can I save annually on my electric bill if I add solar panels to my house in Alexander?
Once you add solar panels to your Alexander home, you can expect to save approximately $855.29 per year, or approximately $16,250.45 over the next 20 years.
When does the federal solar tax credit end?
The Clean Energy Credit (formerly named the federal solar tax credit, or 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.
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.