2024 Solar Incentives Guide for West Memphis, AR - Tax Credits & Rebates

What Solar Tax Credits, Incentives, and Rebates are Available in West Memphis?

Source: https://www.dsireusa.org/

Solar incentives are intended to encourage people to make the switch to renewable energy by offering financial incentives meant to lower the burden of solar panel installation and use. Incentives might include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are handled federally, while others are provided by the Arkansas government or by your specific utility company, county or municipality. Some solar incentives you might qualify for are:

• Tax Credits: Tax credits decrease, dollar-for-dollar, how much income tax you owe the government. Tax credits differ from tax deductions.
• Net Metering: Net metering becomes relevant once your solar panels are up and running. If you have a net metering agreement in place with your West Memphis utility company, the company will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some places, this is a dollar-for-dollar credit, while in other places you may be refunded a percentage of the value.
• Rebates: Some solar companies will help you claim a rebate, or partial refund after purchase, for your solar panels. States or counties will also sometimes offer limited-time rebates. If you receive a rebate, that amount will usually be deducted from the total price before tax credits are calculated.
• Tax Exemptions: These might come in the form of property tax exemptions, which let you ignore the value added by your solar panels when paying property tax on your house. You could also look for exemptions on sales tax at the time of purchase.

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Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some familiarity with. You might have heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a predetermined percentage of the money you spend on solar panels for your home.

The ITC can be applied to the total cost of installing solar panels, including the panels themselves as well as equipment, labor and accessories. You can claim this credit for panels installed after January 1, 2006, on a primary or secondary residence that you own, as long as it is located in the United States. The tax credit ranges from 26-30% of total costs depending on when your project was completed. There is no maximum amount you can claim.

Reaching out to your local West Memphis solar panel installation expert is the best way to understand how the ITC may apply to your situation.

In August 2022, the ITC (now titled the Clean Energy Credit) was expanded and extended by the passage of the Inflation Reduction Act. The Clean Energy Credit has increased the current credit up to 30% for solar installations undertaken between January 1, 2022, and December 31, 2032. At this point, the percentage will be reduced slightly each year until the end of the program 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 West Memphis solar panel installers are the best people to answer your questions about the new Clean Energy Credit and how it may apply to you.

State & Local Solar Incentives

There are often state solar incentives available in addition to federal ones. Tax credits, rebates and more might be available at a more local level. Some incentives are ongoing, while others may only be available for a limited time. These incentives might be provided by the Arkansas government, or by your county or municipality.

Next Steps for Installing Solar in West Memphis

Solar energy use nationwide has significantly increased in the past 15 years, in part due to the increase in availability of solar incentives. You may get these incentives from your local utility company, the Arkansas government or the federal government. We suggest talking to your local West Memphis solar installation expert to learn more about these incentives and to ensure that you're getting all the money you can for your solar panels.