2023 Solar Incentives Guide for Nashville, AR - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Nashville.
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 May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Nashville?
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The term "solar incentives" refers to a wide range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Various kinds of incentives, like discounts, cash back or monthly utility bill credits, may be available to you. Some incentives may be provided via the Arkansas government, by your utility company or by county or municipality, while other incentives are federal. You might qualify for any of the following types of solar incentives:
- Tax Exemptions: Sales tax exemptions go into effect at the point of sale for your solar system. Property tax exemptions allow you to ignore the value that your solar panels add when you're calculating how much property tax you need to pay on your home.
- Rebates: Solar rebates may be provided by your county or state, or by your local utility company. These rebates work as cash back that is applied after you purchase solar panels and before tax credits are calculated.
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.
- Net Metering: Net metering becomes relevant after your solar system is up and running. If you have in place a net metering agreement with your Nashville utility company, it will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some areas, this credit is dollar-for-dollar, while in other places you might get refunded a percentage of the value.
Federal Solar Incentives
Federal solar incentives are likely the first thing that comes to mind when you think about solar incentives. You may have heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a certain percentage of the money you spend on your solar system.
The ITC covers solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, equipment, accessories and labor. You can receive this credit for a solar panel system installed on a primary or secondary residence in the United States that you own. Originally, you could claim 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum amount you can claim.
To better understand how the ITC will apply to you, get in touch with your local Nashville solar panel installer and request more information.
The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. After this, the credit percentage will see a slight decrease annually until the end of the program in 2035. The expansion 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. To understand how the new Clean Energy Credit applies to you, reach out to your local Nashville solar installation company.
State & Local Solar Incentives
In addition to those provided at the federal level, there are often also state solar incentives. Tax credits, rebates and more can be offered at a more local level. These incentives might be handled by your county or municipality, or by the Arkansas government. Certain incentives are ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Nashville
Nationwide solar energy use has significantly increased in the last 15 years, in part due to the growth in the number of solar incentives. You may get these incentives from your local utility company, the federal government or the Arkansas government. Your local Nashville solar panel installation expert can give you more information about which incentives you should apply for, and get you feeling good about making the change to renewable energy today.
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EcoWatch's Nashville, AR Solar Incentives FAQs
What if I am planning to add a solar system to a rental property, vacation home or commercial property? Can I still qualify for incentives?
Many solar incentives are intended to apply to a property you own that is located within the United States, and most secondary residences fall under this distinction. Other solar incentives may be available for commercial properties, depending on the details. We recommend talking to your local solar installer and/or tax professional to fully understand what incentives may apply to your specific situation.
How do I know if I qualify for certain solar incentives?
Broadly, solar incentives apply to:
- a new solar system
- installed on a property that 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 Nashville solar installer to find out what incentives your project may qualify for.
I already have solar panels installed. Are there any incentives that I qualify for?
If your solar panels were installed after January 1, 2022, you may qualify for the recently increased 30% tax credit under the Inflation Reduction Act. If you installed your system between 2006 and 2021, you might qualify for a tax credit between 26% and 30%, depending on the exact installation date. Talking to the company that installed your solar system, or any local Nashville solar installer, can help you learn what incentives you might want to apply for.
How much can I save annually on my electric bill if I add solar panels to my Nashville home?
Generally, homeowners in Nashville who install solar panels save around $927.44 per year, or around $17,621.27 over 20 years after they make the switch.
I want to trade in my old appliances for ones that are more energy-efficient. Are there any benefits I can claim?
The recently passed Inflation Reduction Act introduces several incentives that reward homeowners who make eco-friendly upgrades. Some incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.
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.