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

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

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

Solar incentives encourage people to make the switch to renewable energy by providing financial incentives meant to lower the burden of solar panel installation and use. Incentives could include things like discounts, cash back or credit on your utility bill each month. Some incentives are handled federally, while others are provided by the state of Colorado or by your specific utility company, county or municipality. Types of solar incentives might include:

• Net Metering: Net metering becomes relevant after your solar panels are up and running. If you've signed a net metering agreement with your Westminster utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this is a dollar-for-dollar credit, while in other places you may receive a refund equivalent to a percentage of the value.
• 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 property tax on your house. You may also qualify for an exemption 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 government. (This is different from a tax deduction.)
• Rebates: A solar rebate is a partial refund after the purchase of 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.

Federal Solar Incentives

When people think of solar incentives, federal incentives are likely the first thing that comes to mind. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a percentage of the cost of your solar system.

The ITC covers solar systems installed after January 1, 2006 and under this program you can deduct from your taxes a percentage of the total cost of solar panels, accessories, labor and equipment. This credit can be claimed on a solar panel system installed on a primary or secondary residence that you own in the United States. The original claim amount was 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum amount you can claim.

Your local Westminster solar panel installer can provide more information about the ITC and how it applies to your situation.

In August 2022, the Inflation Reduction Act expanded and extended the ITC, now called the Clean Energy Credit. Homeowners can now qualify for a credit of 30% of the total costs of solar system installation for projects that began after January 1, 2022 and will be finished by the end of 2032. The credit percentage will then decrease annually until the Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. The best way to understand how the new Clean Energy Credit will apply to you is to get in touch with your local Westminster solar panel installation expert.

State & Local Solar Incentives

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

Next Steps for Installing Solar in Westminster

Solar incentives can come from your local utility company, the federal government or the Colorado government. The variety of available solar incentives has helped nationwide use of solar energy increase greatly in the last 15 years. Call your local solar panel installation expert today to find out more information and to save as much money as possible on solar panels for your Westminster home.