2023 Solar Incentives Guide for Siloam Springs, AR - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Siloam Springs.
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 May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Siloam Springs?
Federal Residential Renewable Energy Tax Credit
Solar incentives are meant to encourage homeowners to make the switch to renewable energy by providing incentives that lower the financial burden of solar panel installation and use. Solar incentives may include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are provided by the federal government, some by the Arkansas government and some by your utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Tax Credits: Tax credits reduce, dollar-for-dollar, how much income tax you owe the government. These are different from tax deductions.
- Net Metering: Net metering becomes relevant after your solar panels are up and running. If you have in place a net metering agreement with your Siloam Springs utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some places, this credit is dollar-for-dollar, while in other areas you may receive a refund equivalent to a percentage of the value.
- Tax Exemptions: Sales tax exemptions are effective at the point of sale for your solar panels. Property tax exemptions let you ignore the added value of your solar system when you calculate how much property tax you need to pay on your house.
- Rebates: Solar rebates can be offered by your local utility company, or by your state or county. These rebates work as partial refunds that are applied after your purchase of solar panels and before tax credits are calculated.
Federal Solar Incentives
Federal solar incentives are probably the first thing that comes to mind when thinking about solar incentives. One of the incentives many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a certain percentage of the cost of your solar system.
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 claim the credit. Originally, the ITC covered 30% of all installation costs (panels, equipment, labor and accessories), although the amount has fluctuated slightly 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 amount you can claim.
Your local Siloam Springs solar panel installation expert can offer more information about the ITC and how it applies to your situation.
In August 2022, the ITC (now titled the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners can receive a credit for 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems with the new act.
More information about the new Inflation Reduction Act can be found here. The best way to learn more about how the new Clean Energy Credit applies to you is to talk with your local Siloam Springs solar panel installers.
State & Local Solar Incentives
There are often state solar incentives available in addition to federal ones. Rebates, tax credits and more might be available at a more local level. These incentives — which might be given by the state of Arkansas, or by your county or municipality — could be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Siloam Springs
Nationwide solar energy use has gone up significantly in the past 15 years, in part thanks to the increase in availability of solar incentives. You might receive these incentives from your local utility company, the federal government or the Arkansas government. Reaching out to your local Siloam Springs solar panel installation company is the right first step towards getting all the incentives you qualify for when you switch to solar energy.
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EcoWatch's Siloam Springs, AR Solar Incentives FAQs
How much can I save annually on my electric bill if I add solar panels to my Siloam Springs home?
Typically, homeowners in Siloam Springs who install solar panels save about $852.16 per year, or about $16,191.00 over 20 years after making the switch.
What are some environmental benefits of adding solar panels to my house?
You can decrease your carbon footprint by 500 pounds of CO2 annually by switching to solar panels. This adds up to approximately 10,000 pounds in 20 years. In addition, solar power is a renewable energy source, meaning that switching your home over lessens the drain on our planet's resources.
When does the federal solar tax credit end?
The federal solar tax credit, formerly called the ITC and now titled the Clean Energy Credit, is slated to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
If I switch my appliances out for ones that use solar energy, are there any benefits I can claim?
With the passage of the new Inflation Reduction Act, there are several new financial incentives to encourage you to make eco-friendly improvements to your home. More details about these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I use both solar and another type of renewable energy to power my home?
Yes, you can utilize multiple types of renewable energy to power your home, such as a combination of wind and solar. You can also combine renewable energy generation with a backup source of non-renewable energy. Be sure to discuss your proposed plan with your local Siloam Springs solar installation expert, to get an understanding of what will be needed and what incentives you may or may 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.