2025 Solar Incentives Guide for Somerton, AZ - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Somerton.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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What Solar Tax Credits, Incentives, and Rebates are Available in Somerton?
Solar and Wind Equipment Sales Tax Exemption
Residential Solar and Wind Energy Systems Tax Credit
Qualifying Wood Stove Deduction
Energy Equipment Property Tax Exemption
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives help mitigate the cost of installing a solar panel system on your home. These financial incentives are in place to encourage more Americans to switch to renewable energy. 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 Arizona government or your specific utility company, county or municipality. Some broad categories of solar incentives include:
- Net Metering: You may be able to sign a net metering contract with your Somerton utility company that will apply to all or a percentage of the excess electricity your solar panels generate. Your utility company will then subtract this value from your monthly utility bill.
- Tax Credits: Tax credits decrease, dollar-for-dollar, the amount of income tax you owe the federal government. Tax credits are different from tax deductions.
- Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar system. These might be offered by your local utility company, your county or your state. The cash back that you get from the rebates is normally applied before tax credits are calculated.
- Tax Exemptions: Tax exemptions may come in one of two forms. The first is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption. This allows you to ignore the added value of your solar system when calculating property tax for your home.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some knowledge of. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a predetermined percentage of your solar system's cost.
The ITC applies to solar systems installed after January 1, 2006, on a primary or secondary residence in the United States that you own. The credit initially covered 30% of the total cost – for panels, equipment, accessories and labor – although the percentage may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the claim amount.
To better understand exactly how much money the ITC could save you, speak with your local Somerton solar panel installation expert.
The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. Homeowners are now eligible for a credit equal to 30% of the total costs of solar system installation for projects started after January 1, 2022, and completed before the end of 2032. The percentage will then decrease on a yearly basis until the Clean Energy Credit ends in 2035. The program expansion also makes it easier to get credit for energy storage systems, beginning in 2023.
More information about the new Inflation Reduction Act can be found here. To best understand how the new Clean Energy Credit will apply to you, speak with your local Somerton solar installers.
State & Local Solar Incentives
Tax credits, rebates and more can be claimed at multiple levels. In addition to federal solar incentives, there are often state and local ones as well. The incentives — which may be handled by your county or municipality, or by the state of Arizona — could be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Somerton
You can apply for and receive solar incentives from the Arizona government and the federal government, as well as from your local utility company. The growing availability of solar initiatives in the past 15 years has helped increase nationwide solar energy use enormously. Reaching out to your local Somerton solar panel installer is a great first step towards getting all the incentives you qualify for when you switch to solar energy.
EcoWatch's Somerton, AZ Solar Incentives FAQs
If my house already has solar panels, can I still claim incentives?
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 system, or any local Somerton solar installer, can help you understand what incentives you qualify for.
How much will a solar system save me annually on my electric bill in Somerton?
On average, Somerton homeowners who install solar panels save approximately $1,335.15 per year, or about $25,367.86 over 20 years after making the switch.
Who installs solar panel systems near me?
To find the best solar panel installation companies near you, take a look at our article on Somerton's top solar panel companies.
What are some environmental benefits of adding solar panels to my home?
Solar energy is a renewable energy source — by switching where you get your energy, you can help reduce the strain on our planet's resources. A solar system can also lower the CO2 emissions from your home by 500 pounds annually, or around 11,000 pounds in 20 years.
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.