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

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

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

The term "solar incentives" refers broadly to financial incentives put in place by solar companies and the government to encourage the use of renewable energy by making installing and using solar panels more affordable. Different types of incentives, such as 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:

• 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.)
• Tax Exemptions: Sales tax exemptions go into effect at the point of sale for your solar system. Property tax exemptions allow you to ignore the value that your solar panels add when you calculate the amount of property tax you need to pay.
• Net Metering: Don't forget to speak with your Blue Island utility company about signing a net metering contract. This will allow you to get a credit towards your monthly utility bill for the value of excess energy your solar panels generate. You may receive either a dollar-for-dollar credit or a percentage of the value.
• Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar panels. These might be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives may be available to you if you have a solar system that produces over a specified (typically small) amount of electricity. This category of incentives is normally handled by the state government. You can sell the SRECs you receive to your utility company or other buyers, and the money you receive in return is typically considered part of your taxable income.

Federal Solar Incentives

When people think of solar incentives, federal incentives may be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is probably the most well-known federal solar incentive. The ITC provides you with a tax credit for a specific percentage of your solar system's cost.

The ITC was originally for 30% of the cost of solar panel installation, although it has fluctuated slightly over the last few years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The cost of installation includes the panels themselves as well as the cost of equipment, labor and accessories. There is no maximum claim amount. The ITC can be applied to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be owned by you and in the United States.

Speaking with your local Blue Island solar panel installer is the best way to understand how the ITC could apply to your situation.

In August 2022, the Inflation Reduction Act expanded and extended the ITC, now referred to as the Clean Energy Credit. The Clean Energy Credit is valid until 2035. Any solar installation project that is completed between January 1, 2022 and December 31, 2032 may qualify for a 30% tax credit. The amount will then decrease slightly each year until the end of the current program. Starting in 2023, it will also be easier to obtain credits for energy storage systems under the new laws.

More information about the new Inflation Reduction Act can be found here. Your local Blue Island solar panel company can answer any questions you have and explain how the new Clean Energy Credit applies to you.

State & Local Solar Incentives

Tax credits, rebates and more can be claimed at multiple levels. In addition to federal solar incentives, there are often state and local ones as well. Certain incentives are ongoing, while others are only available for a limited time. Incentives may be offered by the Illinois government, or by your county or municipality.

Next Steps for Installing Solar in Blue Island

There are a number of different solar incentives: those given by the federal government, those given by the Illinois government and those given by local utility companies, to name a few. The use of solar energy has increased tremendously in the last 15 years, thanks to these incentives. Your local Blue Island solar panel installation expert can provide you with more details about which incentives you might qualify for, and get you on track to switch to renewable energy today.