2023 Solar Incentives Guide for Loveland, CO - Tax Credits & Rebates

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

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

The term "solar incentives" generally refers to financial incentives designed to encourage the use of renewable energy by making solar panels more affordable. Different types of incentives, including cash back, discounts or credit towards your monthly utility bill, might be available to you. Some incentives may be provided via the state of Colorado, by your utility company or by county or municipality, while other incentives are federal. Types of solar incentives might include:

• Rebates: Rebates, or partial refunds after a purchase, are usually applied before any solar tax credits are calculated. Solar rebates can be provided by your local utility company, by your state or by your county.
• Tax Exemptions: These can come in the form of property tax exemptions, which allow you to exclude the value added by your solar panels when paying property tax on your home. They may also include exemptions on sales tax at the time of purchase.
• Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the federal government. (This is different from a tax deduction.)
• Net Metering: Net metering becomes relevant after your solar panels are up and running. If you've signed a net metering agreement with your Loveland utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in others you may be refunded a percentage of the value.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have heard of. An incentive that most people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a given percentage of your solar system's cost.

The ITC can be applied to a solar system 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 be eligible for the credit. The ITC initially covered 30% of all system costs (panels, equipment, labor and accessories), although the amount has fluctuated over the 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 claim amount.

Your local Loveland solar panel installation expert can offer more information about the ITC and how it may apply to your situation.

The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as renaming it to the Clean Energy Credit). The new Clean Energy Credit now runs until 2035. You are now eligible for a 30% credit for solar systems installed between January 1, 2022 and December 31, 2032. The total credit will then be decreased by a few percentage points every year until it expires. Starting in 2023, it will also be easier to get credits for energy storage systems under this new program.

Click here to learn more about the new Inflation Reduction Act. To best understand how the new Clean Energy Credit applies to you, reach out to your local Loveland solar installers.

State & Local Solar Incentives

Some solar incentives may be provided at the state and local level. Like with federal incentives, these could include tax credits, rebates and more. Some incentives are ongoing, while others are offered for only a limited time. These local incentives might come from your county or municipality, or from the Colorado government.

Next Steps for Installing Solar in Loveland

The nationwide use of solar energy has gone up tremendously in the last 15 years, in part due to the growth in the number of solar incentives. You can obtain these incentives from your local utility company, the federal government or the Colorado government. Reaching out to your local Loveland solar panel installation expert is an excellent first step towards making sure you get all the incentives you qualify for when you switch to solar energy.