2024 Solar Incentives Guide for Bloomingdale, IL - Tax Credits & Rebates

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

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

Solar incentives mitigate the cost of installing solar panels on your home. Financial incentives like these are designed to encourage more homeowners to switch to renewable energy. Incentives could include things like discounts, cash back or monthly utility bill credits. Some incentives are handled federally, while others are handled by the Illinois government or your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:

• Solar Renewable Energy Certificate (SREC): In general, solar systems that produce over a threshold (generally small) amount of electricity qualify for SRECs or other similar performance-based incentives. SRECs and performance-based incentives in general are typically given by your state government. When you receive an SREC, you can sell it to your utility company or another buyer, and generally the money you make is normally considered part of your taxable income.
• Tax Exemptions: Tax exemptions may come in one of two forms. The first is sales tax exemption, 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 calculating property tax for your home.
• Rebates: A solar rebate is a partial refund given after you've purchased your solar system. These could 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.
• Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
• Net Metering: Make sure you talk to your Bloomingdale utility company about signing a net metering agreement. This allows you to receive credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You might receive either a dollar-for-dollar credit or a percentage of the value.

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Federal Solar Incentives

When you hear the term "solar incentives," federal incentives might be the first thing that comes to mind. An incentive many people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a certain percentage of the cost of your solar system.

The ITC can be applied to solar panels installed after January 1, 2006, on a primary or secondary residence in the United States that you own. The credit initially covered 30% of the total cost – for panels, accessories, equipment and labor – although that amount may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the claim amount.

Wondering how the ITC applies to your specific situation? Get in touch with your local Bloomingdale solar panel installer to get more information.

The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as retitling it the Clean Energy Credit). For solar system installations that begin after January 1, 2022, and are completed by the end of 2032, homeowners can apply for a credit for 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit ends in 2035. The expansion to the program also makes it easier to get credit for energy storage systems, beginning in 2023.

More information about the new Inflation Reduction Act can be found here. Your local Bloomingdale solar panel installer can answer your questions and explain how the new Clean Energy Credit will apply to you.

State & Local Solar Incentives

Federal solar incentives are not your only option; tax credits, rebates and more may be offered at the state and local level. These incentives might be provided by the Illinois government, or by your county or municipality. Some are available for a limited time, while others are ongoing.

Next Steps for Installing Solar in Bloomingdale

Nationwide solar energy use has significantly increased in the last 15 years, in part due to the increase in availability of solar incentives. You might receive these incentives from your local utility company, the federal government or the Illinois government. We recommend talking to your local Bloomingdale solar installer to learn more about these incentives and to ensure that you're getting the largest number possible for your solar system.