2025 Solar Incentives Guide for Carmichael, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Carmichael.
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 Carmichael?
Property Tax Exclusion for Solar Energy Systems and Solar Plus Storage System
Western Riverside Council of Governments - Home Energy Renovation Opportunity (HERO) Financing Program
Minimum financing: $5,000
The financing may not exceed fifteen percent (15%) of the market value of the property, up to the first seven hundred thousand dollars ($700,000) of the property’s market value, and ten percent (10%) of the remaining value of the Property above seven hundred thousand dollars ($700,000) minus any PACE assessment on the propertyThe total amount of any annual property taxes and assessments shall not exceed five percent (5%) of the property's fair market value, determined at the time program financing is approved.
Local Option - Municipal Energy Districts
Renewable Market Adjusting Tariff (ReMAT)
LADWP - Feed-in Tariff (FiT) Program
Base price will step down over time as certain MW goals are met
SMUD - PV Residential Retrofit Buy-Down
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are designed to mitigate the cost of installing a solar panel system on your home. This category of financial incentives is intended to encourage more Americans to make the switch to renewable energy. You may qualify for several types of incentives, such as discounts, cash back or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of California and others from the federal government. Some solar incentives you might qualify for are:
- Rebates: Rebates, or partial refunds after a purchase, are typically given before any solar tax credits are calculated. Rebates can be given by your local utility company, by your state or by your county.
- Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives might be available to you if the solar system on your home produces more than a specified (typically small) amount of electricity. This category of incentives is typically handled by the state government. You can sell your SRECs to your utility company or other buyers, and the money you make is generally considered part of your taxable income.
- 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.
- Tax Exemptions: These can come in the form of property tax exemptions, which let you exclude the value added by your solar panels when paying taxes on your house. You could also look for exemptions on sales tax at the time of purchase.
- Net Metering: Don't forget to speak to your Carmichael utility company about signing a net metering agreement. This will allow you to get a credit towards your utility bill every month for the value of excess energy generated by your solar panels. You could receive either a dollar-for-dollar credit or a percentage of the value.
Federal Solar Incentives
Federal solar incentives are likely the first thing that you think of when you think about solar incentives. One of the incentives many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a specific percentage of your solar system's cost.
The ITC applies to a solar system installed on your primary or secondary residence in the United States. The solar system must have been installed after January 1, 2006, on a property you own for you to claim the credit. The ITC originally paid out 30% of all system costs (panels, accessories, labor and equipment), although this amount has fluctuated over time between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the claim amount.
To more fully understand how the ITC could apply to your situation, call your local Carmichael solar panel installer and request more information.
In August 2022, the ITC (now titled the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. For solar systems installed between January 1, 2022, and December 31, 2032, homeowners may be eligible for a credit equal to 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit ends in 2035. The expansion to the program also makes credits for energy storage systems even easier to claim, beginning in 2023.
Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit might apply to you, talk to your local Carmichael solar installation expert.
State & Local Solar Incentives
Tax credits, rebates and more might be provided at multiple levels. In addition to federal solar incentives, there are often state and local ones as well. Incentives might be given by your county or municipality, or by the state of California. Certain incentives may be available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Carmichael
There are a variety of solar incentives: those provided by local utility companies, those offered by the federal government and those offered by the California government, to name a few. Solar energy utilization has grown tremendously in the last 15 years, thanks to these incentives. We suggest talking to your local Carmichael solar installation expert for more information about these incentives and to ensure that you're getting all the money you can for your solar panels.
EcoWatch's Carmichael, CA Solar Incentives FAQs
If I installed solar panels on my house a few years ago, 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 had your system installed between 2006 and 2021, you might qualify for a tax credit between 26% and 30%, depending on the year it was installed. Talking to the company that installed your solar system, or any local Carmichael solar installer, can help you learn more about what incentives you might want to apply for.
How much will solar panels save me on my electric bill in Carmichael annually?
Once you add solar panels to your Carmichael home, you can expect to save around $1,334.57 per year, or around $25,356.75 over 20 years.
Who installs solar panels near me?
To find a top-rated solar panel installer, check out our guide to Carmichael's top solar panel companies.
What are the environmental benefits of switching to solar energy?
You can lower your carbon footprint by 250 pounds of CO2 annually when you switch to solar panels. This adds up to roughly 5,000 pounds over 20 years. Solar is also a renewable energy source, meaning that making the switch reduces the drain on our planet's resources.
Can I apply for incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can claim 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. Make sure that you speak with your solar installer or a local tax professional to ensure that you are claiming incentives correctly and getting the most money possible.
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.