2023 Solar Incentives Guide for Johnson, AR - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Johnson.
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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Updated September 15, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Johnson?
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are designed to encourage homeowners to switch to renewable energy by providing financial incentives meant to lower the burden of solar panel installation and use. You may qualify for various types of incentives, including discounts, cash back or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the Arkansas government and others from the federal government. Some broad categories of solar incentives include:
- Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
- Tax Exemptions: Tax exemptions can come in one of two forms. The first is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption, which allows you to exclude the value added by your solar system when paying property tax on your home.
- Rebates: Your solar installer might help you claim a rebate, or partial refund after purchase, for your solar system. Counties or states will also sometimes offer limited-time rebates. If you receive a rebate, that amount will usually come off your total price before any tax credits are calculated.
- Net Metering: You may be able to sign a net metering agreement with your Johnson utility company that will apply to all or a percentage of the excess electricity that is generated by your solar panels. Your utility company will then subtract this value from your monthly utility bill.
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Federal Solar Incentives
Federal solar incentives are likely the first thing that comes to mind when you think about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC provides a tax credit for a predetermined percentage of your solar system's cost.
The ITC covers 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, labor, accessories and equipment. This credit can apply towards a solar panel system installed on a primary or secondary residence in the United States that you own. The original amount you could claim was 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum claim amount.
Wondering how the ITC applies to your specific situation? Contact your local Johnson solar panel installation expert to get more information.
In August 2022, the ITC (now called the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. With the new provisions, solar installation projects begun after January 1, 2022 and finished by December 31, 2032 might qualify for a 30% tax credit. The amount of the credit will then decrease slightly each year until the end of the current Clean Energy Credit in 2035. Starting in 2023, the program expansion will also make it easier to get credit for energy storage systems.
Click here to learn more about the new Inflation Reduction Act. Your local Johnson solar panel installer can answer any questions you have and explain how the new Clean Energy Credit applies to you.
State & Local Solar Incentives
Not all solar incentives are federal; rebates, tax credits and more are often offered at the local or state level. These incentives — which may 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 Johnson
The nationwide use of solar energy has increased enormously in the past 15 years, in part thanks to the growth in the number of solar incentives. You may get these incentives from the Arkansas government, the federal government or your local utility company. It is a good idea to talk to your local Johnson solar installation company to learn more about these incentives and to be sure that you're getting the largest number possible for your solar panels.
EcoWatch's Johnson, AR Solar Incentives FAQs
Can I receive any incentives when I add solar panels to a rental property, vacation home or commercial property?
While we recommend speaking with your local solar installer and/or tax professional to fully understand what solar incentives apply to you, many incentives can be claimed on a second home, provided that it is in the United States and owned by you. There may be other incentives available specifically for commercial properties, depending on the details.
How can I find out if I qualify for specific solar incentives?
Broadly, solar incentives apply to:
- a new solar panel system
- installed on property you own
- within the U.S.
- within the date range specified by a particular incentive.
Specific incentives, including those given out by the Arkansas government or by your county/municipality, sometimes have additional qualifications. Speak with your local Johnson solar installer to discover what incentives your project will qualify for.
How much will a solar system save me on my electric bill in Johnson annually?
After adding solar panels to your home in Johnson, you can anticipate savings of about $838.66 per year, or about $15,934.53 over 20 years.
What are the highest-rated solar panel installation companies near me?
To find the right solar panel installer for you, check out our guide to the top solar companies in Johnson.
Can I qualify for incentives both towards the initial cost of solar panels, and later as reimbursement?
The order that incentives will be applied in might vary depending on which incentives you are eligible for but generally yes, you can receive multiple types of incentives for your solar project. Get in touch with your solar installer or a local tax professional to be sure 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.