2023 Solar Incentives Guide for Drexel Heights, AZ - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Drexel Heights.
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 Drexel Heights?
Solar and Wind Equipment Sales Tax Exemption
Residential Solar and Wind Energy Systems Tax Credit
Qualifying Wood Stove Deduction
Energy Equipment Property Tax Exemption
Trico Electric Cooperative - SunWatts Incentive Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The term "solar incentives" includes a 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. Different types of incentives, like cash back, discounts or monthly utility bill credits, may be available to you. Certain incentives may be provided via the Arizona government, by your utility company or by county or municipality, while other incentives are federal. Types of solar incentives might include:
- 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.
- Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you have in place a net metering agreement with your Drexel Heights 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 areas, this is a dollar-for-dollar credit, while in other areas you might make back a percentage of the value.
- Rebates: Solar rebates can be offered by your county or state, or by your local utility company. These rebates are essentially partial refunds that are applied after you purchase a solar system and before tax credits are calculated.
- Tax Exemptions: Your solar panel system might qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions let you exclude the value that solar panels add when you are calculating property taxes on your house.
Federal Solar Incentives
When you hear the term "solar incentives," federal incentives might be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is likely the best-known federal solar incentive. The ITC offers a tax credit for a set percentage of your solar system's cost.
The ITC can be applied to solar panels installed after January 1, 2006 on a primary or secondary residence in the United States that you own. Originally, the tax credit was for 30% of the total cost — for panels, labor, equipment and accessories — although that amount may range from 26-30%, depending on when your solar system was installed. There is no cap on the claim amount.
Speaking with your local Drexel Heights solar panel installer is the best way to learn more about how the ITC applies to you.
The ITC has been renewed and expanded following the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The Clean Energy Credit lasts until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit; this amount will be decreased slightly on a yearly basis until the current program ends. Starting in 2023, the program expansion will also make credits for energy storage systems even easier to claim.
More information about the new Inflation Reduction Act can be found here. Your local Drexel Heights 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. Rebates, tax credits and more might be available at a more local level. Some incentives are offered for only a limited time, while others are ongoing. These local incentives could come from the Arizona government, or from your specific county or municipality.
Next Steps for Installing Solar in Drexel Heights
The large number of solar incentives available has helped tremendously increase the use of solar power nationwide over the last 15 years. You might qualify for solar incentives from the federal government, the Arizona government or from your local utility company. Speaking with your local Drexel Heights solar panel installation company is an excellent first step towards getting all the incentives you qualify for when you switch to solar energy.
EcoWatch's Drexel Heights, AZ Solar Incentives FAQs
Can I claim incentives for adding solar panels to a rental property, vacation home or commercial property?
While we recommend talking to your local solar installer and/or tax professional to better understand what solar incentives apply to you, many can be claimed on a second home, so long as that home is in the United States and owned by you. There may be other incentives available specifically for commercial properties, depending on the specifics.
My home already has solar panels installed. Does my system qualify for any incentives?
You should plan to talk to someone from the company that installed your system — or call a local Drexel Heights solar installer — to clarify which incentives you may qualify for. If your system was installed after January 1, 2022, you likely qualify for the recently increased 30% tax credit under the Inflation Reduction Act. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
I want to switch my appliances out for ones that are more energy-efficient. Are there any benefits I can apply for?
With the passage of the new Inflation Reduction Act, there are several new financial incentives for making 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 multiple types of renewable energy to power my home?
You can power your home with multiple types of renewable energy, or a combination of renewable and non-renewable energy. Be sure to talk through your ideas with your local Drexel Heights solar installation expert. They can help you plan your project and educate you on the various incentives that 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.