2024 Solar Incentives Guide for North Little Rock, AR - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in North Little Rock.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in North Little Rock?
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Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The term "solar incentives" refers to financial incentives implemented by the government and by solar companies to encourage the adoption and use renewable energy by making installing and using solar panels more affordable. You might qualify for various types of incentives, such as discounts, cash back or monthly utility bill credits, 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. You might qualify for any of the following types of solar incentives:
- Tax Exemptions: These may come in the form of property tax exemptions, which would allow you to ignore the value of your solar system when paying taxes on your home. You could also look for exemptions on sales tax at the time of purchase.
- Net Metering: Be sure to talk with your North Little Rock utility company about signing a net metering agreement. This allows you to get a credit towards your monthly utility bill for the value of excess energy your solar panels generate. You may receive either a dollar-for-dollar credit or a percentage of the value.
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
- Rebates: Solar rebates can be provided by your state or county, or by your local utility company. These rebates work as partial refunds that are applied after you purchase a solar system and before tax credits are calculated.
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Federal Solar Incentives
When thinking about solar incentives, federal incentives might be the first thing that comes to mind. A federal incentive that most people are probably 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 can be applied to solar systems installed after January 1, 2006, and lets you deduct from your taxes a percentage of the total cost of solar panels, labor, equipment and accessories. This credit can apply towards a solar panel system installed on a primary or secondary residence that you own in the United States. The original claim amount was 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.
Your local North Little Rock solar panel installation expert can provide more information about the ITC and how it applies to your situation.
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 may be eligible for a credit for 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit expires in 2035. Starting in 2023, it will also be easier to claim credits for energy storage systems under this new program.
More information about the new Inflation Reduction Act can be found here. The easiest way to understand how the new Clean Energy Credit will apply to you is to get in touch with your local North Little Rock solar panel company.
State & Local Solar Incentives
There are more than just federal solar incentives; rebates, tax credits and more are often offered at the local or state level. These incentives might be handled by the Arkansas government, or by your county or municipality. Some are available for a limited time, while others are ongoing.
Next Steps for Installing Solar in North Little Rock
You can receive solar incentives from the federal government and the Arkansas government, as well as from your local utility company. The growing availability of solar initiatives in the past 15 years has helped greatly increase nationwide adoption of solar energy. We recommend talking to your local North Little Rock solar installer to learn more about these incentives and to make sure that you're getting all the money you can for your solar panels.
EcoWatch's North Little Rock, AR Solar Incentives FAQs
How much can I save annually on my electric bill if I install solar panels on my North Little Rock home?
Once you add solar panels to your home in North Little Rock, you can anticipate savings of about $909.99 per year, or approximately $17,289.90 over the next 20 years.
What are some of the environmental benefits of switching to solar?
Solar energy is a renewable energy source — by switching where you get your energy, you help lessen the strain on our planet's resources. Solar panels can also lower the CO2 emissions from your home by 350 pounds a year, or roughly 7,000 pounds over 20 years.
When does the federal solar tax credit end?
The Clean Energy Credit (formerly called the federal solar tax credit, or ITC), is slated to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I receive incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can receive both rebates and tax credits towards the cost of solar panels. Depending on precisely which incentives you are eligible for, they may apply in a different order. Be sure to talk to your solar installer or a local tax professional to verify that you are claiming the correct incentives and that you're getting the most money possible.
Can I use solar and another type of renewable energy in combination to power my home?
You can power your home with multiple types of renewable energy, or a combination of renewable and non-renewable energy. Make sure you discuss your plan with your local North Little Rock solar installer. They can help you with the plan for your project and also help you understand the various incentives that you might or might not qualify for.
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.