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

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

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

The term "solar incentives" covers a range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. You may be eligible for different types of incentives, including cash back, discounts 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 Illinois and others from the federal government. Categories of solar incentives include:

• Net Metering: Make sure you talk to your Belleville utility company about signing a net metering contract. This allows you to get a credit towards your utility bill every month for the value of excess energy generated by your solar panels. You may receive either a dollar-for-dollar credit or a percentage of the value.
• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are usually handled at the state level. Once your solar panel system meets the threshold (generally a small amount of energy production), you can receive SRECs that can be sold to your utility company or other buyers. The money you receive is generally considered part of your taxable income.
• Tax Exemptions: Your solar system could qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions let you exclude the added value of the solar panels when calculating property taxes on your house.
• Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government. (A tax credit is different from a tax deduction.)
• Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar system. Rebates may be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.

Federal Solar Incentives

When you think about solar incentives, you probably think of federal incentives first. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a specified percentage of your solar system's cost.

The ITC can be credited towards the value of a solar system installed on your primary or secondary residence in the United States. The solar system has to have been installed on a property you own after January 1, 2006 for you to claim the credit. The ITC originally paid out 30% of all installation costs (panels, equipment, labor and accessories), although the amount has fluctuated slightly over the last few years 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 Belleville solar panel installer and ask for more information.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now titled the Clean Energy Credit. The Clean Energy Credit runs until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit; this amount will then decrease slightly each year until the end of the current program. The expansion to the program also makes claiming credit for energy storage systems easier than ever before, starting in 2023.

More information about the new Inflation Reduction Act can be found here. Your local Belleville solar panel company is the best resource for answering your questions about the new Clean Energy Credit and how it applies to you.

State & Local Solar Incentives

There are more than just federal solar incentives; rebates, tax credits and more may be offered at the local or state level. Some incentives are ongoing, while others are only available for a limited time. Solar incentives may be given by your county or municipality, or by the Illinois government.

Next Steps for Installing Solar in Belleville

Nationwide solar energy use has significantly increased in the past 15 years, in part due to the growth in the number of solar incentives. You might receive these incentives from your local utility company, the federal government or the Illinois government. Your local Belleville solar panel installation expert can provide you with more details about which incentives you should apply for, and get you feeling good about making the change to renewable energy today.