2023 Solar Incentives Guide for Waterloo, IA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Waterloo.
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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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
Why you can trust EcoWatch
What Solar Tax Credits, Incentives, and Rebates are Available in Waterloo?
Property Tax Exemption for Renewable Energy Systems
Renewable Energy Equipment Exemption
Solar Energy Systems Tax Credit (Personal)
Local Option - Special Assessment of Wind Energy Devices
Methane Gas Conversion Property Tax Exemption
Geothermal Heat Pump Tax Credit
Energy Replacement Generation Tax Exemption
Reduced rate for large hydro
Alliant Energy Interstate Power and Light - Residential Energy Efficiency Rebate Programs
Air Source Heat Pump: $300-$800 for existing homes, $180-$480 for new homes
Appliance Recycling: up to $50
Central A/C: $150-$600 for existing homes, $90-$360 for new homes
Ductless Mini-Split Heat Pump: Varies
Electric Heat Pump Water Heater: $300-$350 for existing homes, $180-$210 for new homes
Electric HVAC System Tune-Up: up to $50
Gas Furnace: $180 for existing homes, $80 for new homes
Geothermal Heat Pump: $1,320-$1,750 for existing homes, $790-$1,050 for new homes
Learning Thermostat: $100 for existing homes, $60 for new homes
LED Light Bulbs: In-Store Rebates
Online Home Energy Assessment: FREE
Room Air Purifier: up to $30
Variable Speed Pool Pumps: up to $220
Cedar Falls Utilities - Residential Energy Efficiency Rebate Program
Clothes Dryers: $50-$100
Water Heater (Tank or Tankless): $300
Heat Pump Water Heater: $400
Refrigerator/Freezer Recycling: $50
Window A/C Recycling: $25
LED Bulbs: Instant in-store rebate
LED Lighting Fixture: 50% of cost
Natural Gas Boiler: up to $400
Natural Gas Furnace with Variable Speed Blower Motor: Up to $200
Central A/C: Up to $350
Ground-Source Heat Pumps: Up to $300/ton of new ground loop plus up to $300/ton of heating capacity installed
Air-Source Heat Pumps: $600
Ductless Mini Split Systems: up to $100/ton cooling
Duct Work Modifications: 30-75% of cost
Programmable Thermostat: $50
Attic and Sealing Insulation: 60% of cost
Sidewall Insulation: 60% of cost
Foundation Insulation: 60% of cost
Duct Insulation: 60% of cost
Rim/Band Joist Insulation: 60% of cost
Air Sealing, Caulking, and Weather-Stripping: 60% of cost
Federal Residential Renewable Energy Tax Credit
Solar incentives are designed to mitigate the cost of installing solar panels on your home. These financial incentives are in place to encourage more homeowners to switch to renewable energy. Incentives may include things like discounts, cash back or monthly utility bill credits. Some incentives are offered federally, while others are handled by the state of Iowa or by your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Net Metering: Net metering factors in after your solar panels are up and running. If you've signed a net metering agreement with your Waterloo utility company, it will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some locations, this credit is dollar-for-dollar, while in others you may receive a refund equivalent to a percentage of the value.
- Tax Exemptions: Tax exemptions can come in two forms. First, there is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption. This allows you to exclude the value added by your solar system when paying property tax on your home.
- 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.
- Rebates: Rebates, or cash back after a purchase, are typically given before any solar tax credits are calculated. These rebates may be given by your local utility company, by your county or by your state.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some knowledge of. The Federal Solar Investment Tax Credit, or ITC, is the most commonly known federal solar incentive. The ITC provides you with a tax credit for a predetermined percentage of your solar system's cost.
The ITC applies towards solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, accessories, equipment and labor. 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 amount you could claim was 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum claim amount.
To know exactly how much money the ITC could save you, speak with your local Waterloo solar panel installer.
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. The Clean Energy Credit has increased the current credit up to 30% for solar installations undertaken between January 1, 2022 and December 31, 2032. After 2032, the credit percentage will see a slight decrease annually until the end of the program in 2035. Starting in 2023, the expansion will also make credits for energy storage systems even easier to claim.
Click here to learn more about the new Inflation Reduction Act. Your local Waterloo solar panel installation experts can answer your questions and explain how the new Clean Energy Credit may apply to you.
State & Local Solar Incentives
Some solar incentives are often also offered at the local or state level. As with federal incentives, these can include tax credits, rebates and more. These incentives — which might be handled by your county or municipality, or by the state of Iowa — may be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Waterloo
The expanding number of available solar incentives has helped tremendously increase the use of solar power nationwide over the past 15 years. You may receive solar incentives from the federal government, the Iowa government or from your local utility company. Call your local solar panel installer today to learn more and to save the most money possible on solar panels for your Waterloo home.
Best Warranty Coverage
- Industry-leading warranty coverage
- Expansive service area
- Some reported communication issues
- No leases or PPAs
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
EcoWatch's Waterloo, IA Solar Incentives FAQs
What if I am planning to add solar panels to a rental property, vacation home or commercial property? Will I still qualify for incentives?
Many solar incentives apply to a property located within the United States that you own; most secondary residences will fall into this category. Other solar incentives may be available for commercial properties, depending on the details. We recommend speaking with your local solar installer and/or tax professional to best understand what incentives apply to your specific situation.
I already have 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 speak to a local Waterloo solar installer — to learn about which incentives you may qualify for. If your system was installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar panels installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
How much can I save on my electric bill annually if I add solar panels to my house in Waterloo?
Typically, Waterloo homeowners who install solar panels save approximately $841.43 per year, or approximately $15,987.15 over 20 years after they make the switch.
I want to change out my appliances for ones that are more energy-efficient. Are there any incentives I can get?
The recently passed Inflation Reduction Act introduces multiple incentives designed to reward homeowners for making eco-friendly upgrades. Some of these incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
Can I apply for incentives both towards the up-front cost of solar panels, and later as reimbursement?
Yes, you can receive both tax credits and rebates towards the cost of your 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 verify that you are claiming the correct incentives and that you're getting the most money you can.
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.