2025 Solar Incentives Guide for Arkadelphia, AR - Tax Credits & Rebates

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

Source: https://www.dsireusa.org/

Solar incentives are meant to encourage homeowners to make the switch to renewable energy by providing incentives that lower the financial burden of solar panel installation and use. Different kinds of incentives, including cash back, discounts or credit towards your monthly utility bill, might be available to you. Some incentives may be handled by the state of Arkansas, by your utility company or by county or municipality, while other incentives are federal. Categories of solar incentives include:

• Rebates: Some solar companies will help you claim a rebate, or partial refund of your purchase, for your solar panels. Counties or states will also offer limited-time rebates at various times. If you receive a rebate, that amount will usually be deducted from the total price before any tax credits are calculated.
• Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar panels. Property tax exemptions let you ignore the value added by your solar system when calculating how much property tax you need to pay on your home.
• Net Metering: Don't forget to speak to your Arkadelphia utility company about signing a net metering contract. This will allow you to receive credit towards your utility bill every month for the value of excess energy your solar panels generate. You might receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (A tax credit is different from a tax deduction.)

Federal Solar Incentives

Federal solar incentives are probably the first thing that you think of when thinking about solar incentives. An incentive that most people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a predetermined percentage of the cost of your solar system.

The ITC applies towards solar systems installed after January 1, 2006, and under this program you can deduct from your taxes a percentage of the total cost of solar panels, accessories, equipment and labor. You can receive this credit for solar panels installed on a primary or secondary residence that you own in the United States. Originally, you could claim 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum amount you can claim.

To best understand how the ITC will apply to you, speak to your local Arkadelphia 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 new Clean Energy Credit extends until 2035. Homeowners can now receive a 30% credit for solar systems installed between January 1, 2022, and December 31, 2032. The total credit will then be decreased by a few percentage points every year until the date of expiration. The program expansion also makes it easier to get credit for energy storage systems, starting in 2023.

Click here to learn more about the new Inflation Reduction Act. Your local Arkadelphia solar panel installation expert is the best person to answer your questions regarding the new Clean Energy Credit and how it will apply to you.

State & Local Solar Incentives

In addition to those provided at the federal level, there are often also state solar incentives. Rebates, tax credits and more may be available at a more local level. Some incentives are ongoing, while others are available for a limited time. They might be offered by your county or municipality, or by the Arkansas government.

Next Steps for Installing Solar in Arkadelphia

You can receive solar incentives from the Arkansas government and the federal government, as well as from your local utility company. The growing availability of solar initiatives over the last 15 years has helped increase nationwide solar energy use enormously. We recommend talking to your local Arkadelphia solar installer for more information about these incentives and to ensure that you're getting the most money possible for your solar panels.