2023 Solar Incentives Guide for Hot Springs Village, AR - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Hot Springs Village.
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 March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Hot Springs Village?
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Federal Residential Renewable Energy Tax Credit
The term "solar incentives" includes a range of financial incentives put in place to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Various types of incentives, like discounts, cash back or monthly utility bill credits, might be available to you. Some incentives may be handled by the Arkansas government, by your utility company or by county or municipality, while others are federal. You might qualify for any of the following types of solar incentives:
- 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 Hot Springs Village utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some locations, this is a dollar-for-dollar credit, while in others you might receive a refund equivalent to a percentage of the value.
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
- Tax Exemptions: These can come in the form of property tax exemptions, which let you exclude the value of your solar system when paying taxes on your home. You may also qualify for an exemption on sales tax at the time of purchase.
- Rebates: Rebates, or partial refunds after a purchase, are usually applied prior to any solar tax credits being calculated. Solar rebates may be offered by your local utility company, by your state or by your county.
Federal Solar Incentives
Federal solar incentives are probably the first thing that comes to mind when you think about solar incentives. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit that reduces your taxes by a specified percentage of the money you spend on solar panels for your home.
The ITC can be credited towards the value of solar panels installed on your primary or secondary residence in the United States. The solar panels have to have been installed on a property you own after January 1, 2006 for you to be eligible for the credit. Originally, the ITC covered 30% of all costs (panels, labor, accessories and equipment), although this amount has fluctuated over the last few years between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the claim amount.
Wondering how the ITC applies to your specific situation? Contact your local Hot Springs Village solar panel installation expert to get more information.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now called the Clean Energy Credit. Homeowners can now receive a credit of 30% of the total costs of solar system installation for projects that began after January 1, 2022 and will be finished by the end of 2032. The percentage will then decrease on a yearly basis until the Clean Energy Credit ends in 2035. Beginning in 2023, it will also be easier to get credits for energy storage systems under the new laws.
More information about the new Inflation Reduction Act can be found here. To fully understand how the new Clean Energy Credit applies to you, talk to your local Hot Springs Village solar installers.
State & Local Solar Incentives
There are often state solar incentives available in addition to federal ones. Tax credits, rebates and more can be offered at a more local level. These solar incentives — which might be provided by the state of Arkansas, or by your county or municipality — could be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Hot Springs Village
Solar incentives might be offered by your local utility company, the federal government or the Arkansas government. The growing number of incentives available has contributed to a large increase in solar energy use in the last 15 years. Speak with your local solar panel installation expert today to learn more and to save the most money possible on a solar system for your Hot Springs Village home.
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- Best solar battery on the market
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- Industry-leading warranty coverage
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- No leases or PPAs
EcoWatch's Hot Springs Village, AR Solar Incentives FAQs
What if I want to add solar panels to a rental property, vacation home or commercial property? Can I still qualify for incentives?
While we recommend getting in touch with your local solar installer and/or tax professional to fully understand what solar incentives apply to you, many incentives apply to a second home, as long as it is in the United States and owned by you. There may be additional incentives available for commercial properties specifically, depending on the specifics.
I already have 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 Hot Springs Village solar installer — to learn about which incentives you may qualify for. If your solar panels were installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar panels installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
How much will a solar system save me on my electric bill in Hot Springs Village annually?
When you add solar panels to your house in Hot Springs Village, you can expect to save about $888.51 per year, or about $16,881.72 over the next 20 years.
What are some environmental benefits of installing solar panels on my home?
Solar energy is renewable — by changing where you get your energy, you can help reduce the strain on our planet's resources. You can also reduce your home's CO2 emissions by 350 pounds a year, or around 7,000 pounds in 20 years.
Can I receive incentives both towards the initial cost of solar panels, and later as reimbursement?
The order that incentives will be applied in may vary depending on which incentives you are eligible for but in most cases yes, you can claim multiple types of incentives for your solar project. Speak to your solar installer or a local tax professional to ensure you are claiming all the incentives you are eligible for and applying them in the correct order.
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.