2023 Solar Incentives Guide for Anna, IL - Tax Credits & Rebates

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

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

The term "solar incentives" covers a wide range of financial incentives implemented to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Different kinds of incentives, like cash back, discounts or monthly utility bill credits, may be available to you. Some incentives may be provided via the state of Illinois, by your utility company or by county or municipality, while other incentives are federal. You might qualify for any of the following types of solar incentives:

• Rebates: Rebates, or partial refunds after a purchase, are typically given before any solar tax credits are calculated. These rebates might be offered by your local utility company, by your county or by your state.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are normally handled by your state government. Once your solar system meets a predetermined threshold (normally a small amount of energy production), you can receive SRECs that you can then sell to your utility company or other buyers. The money you receive from the sale is usually considered part of your taxable income.
• Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
• Net Metering: Net metering factors in after your solar panels are up and running. If you have in place a net metering agreement with your Anna utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some areas, this is a dollar-for-dollar credit, while in others you might get refunded a percentage of the value.
• Tax Exemptions: These might come in the form of property tax exemptions, which would allow you to ignore the value added by your solar panels when paying property tax on your house. You could also look for exemptions on sales tax at the time of purchase.

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 well-known federal solar incentive. The ITC provides a tax credit for a set percentage of your solar system's cost.

The ITC was originally for 30% of the total cost of installing a solar system, although that number has fluctuated slightly over time between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total cost of installation includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum amount you can claim. The ITC applies to solar panels installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.

Curious how the ITC might apply to your specific situation? Contact your local Anna solar panel installation expert to get more information.

The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. After this, the credit percentage will see a slight decrease annually until the end of the program in 2035. Starting in 2023, the program expansion will also make credits for energy storage systems even easier to claim.

More information about the new Inflation Reduction Act can be found here. The best way to learn more about how the new Clean Energy Credit applies to you is to reach out to your local Anna solar panel installers with your questions.

State & Local Solar Incentives

There are often state solar incentives available in addition to federal ones. Tax credits, rebates and more can be offered at a more local level. Certain incentives are ongoing, while others might only be available for a limited time. They might be given by the Illinois government, or by your county or municipality.

Next Steps for Installing Solar in Anna

You can receive solar incentives from the Illinois government and the federal government, as well as from your local utility company. The increased availability of solar initiatives over the last 15 years has helped increase solar adoption nationwide. It is a good idea to talk to your local Anna solar installation company to learn more about these incentives and to be sure that you're getting all of the money you can for your solar system.