2023 Solar Incentives Guide for Fordyce, AR - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Fordyce.
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 Fordyce?
Federal Residential Renewable Energy Tax Credit
Solar incentives mitigate the cost of installing solar panels on your home. Financial incentives like these are intended to encourage more people to switch to renewable energy. Different types of incentives, like cash back, discounts or monthly utility bill credits, may be available to you. Some incentives may be provided via the state of Arkansas, by your utility company or by county or municipality, while other incentives are federal. Some broad categories of solar incentives include:
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the federal government.
- Rebates: Your solar installer might help you claim a rebate, or partial refund of your purchase, for your solar system. States or counties will also offer limited-time rebates at various times. If you receive a rebate, that amount will usually come off the total price before any tax credits are calculated.
- Tax Exemptions: Sales tax exemptions are applied at the point of sale for your solar panels. Property tax exemptions allow you to ignore the value that your solar panels add when you calculate the amount of property tax you need to pay on your home.
- Net Metering: Net metering factors in after your solar system is up and running. If you've signed a net metering agreement with your Fordyce 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 places, this is a dollar-for-dollar credit, while in others you might make back a percentage of the value.
Federal Solar Incentives
When people think of solar incentives, federal incentives might be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is the best-known federal solar incentive. The ITC allows you to claim a tax credit for a predetermined percentage of the cost of your solar system.
The ITC applies to solar panels installed after January 1, 2006 on a primary or secondary residence in the United States that you own. Originally, the tax credit was for 30% of the total cost — for panels, labor, accessories and equipment — although that amount may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the amount you can claim.
Contacting your local Fordyce solar panel installer is the best way to understand how the ITC applies to you.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as retitling it the Clean Energy Credit). For solar systems installed between January 1, 2022 and December 31, 2032, homeowners can receive a credit for 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit ends in 2035. The expansion also makes it easier to get credit for energy storage systems, starting in 2023.
More information about the new Inflation Reduction Act can be found here. The best way to fully understand how the new Clean Energy Credit will apply to you is to speak with your local Fordyce solar panel company directly.
State & Local Solar Incentives
Some solar incentives may be offered at the local or state level. As with federal incentives, these might include tax credits, rebates and more. Some incentives are ongoing, while others may only be available for a limited time. They might be provided by your county or municipality, or by the Arkansas government.
Next Steps for Installing Solar in Fordyce
There are many kinds of solar incentives: those given by the federal government, those given by the Arkansas government and those given by local utility companies, to name a few. Solar energy utilization has grown enormously in the last 15 years, partially due to these incentives. Reaching out to your local Fordyce solar panel installation company is the best first step towards getting all the incentives you qualify for when you switch to solar energy.
EcoWatch's Fordyce, AR Solar Incentives FAQs
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