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

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

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

The phrase "solar incentives" includes a wide 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 might be eligible for various types of incentives, including cash back, discounts or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of Illinois and others from the federal government. You might qualify for any of the following types of solar incentives:

• 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. These types of incentives are generally handled at the state level. You can sell SRECs to your utility company or other buyers, and the money you receive in return is typically considered part of your taxable income.
• Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
• Rebates: Solar rebates can be offered by your local utility company, or by your state or county. These rebates work as cash back that is applied after you pay for solar panels and before tax credits are calculated.
• Tax Exemptions: These may come in the form of property tax exemptions, which would allow you to exclude the value added by your solar panels when paying taxes on your house. You may also qualify for an exemption on sales tax at the time of purchase.
• Net Metering: Net metering is an incentive you can get after your solar system is up and running. If you've signed a net metering agreement with your Bourbonnais utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in others you may make back a percentage of the value.

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Federal Solar Incentives

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

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

Curious how the ITC might apply to your specific situation? Reach out to your local Bourbonnais 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). Homeowners can now qualify for a credit equal to 30% of the total solar system installation costs for projects started after January 1, 2022, and completed before the end of 2032. This percentage will then begin to decrease on a yearly basis until the Clean Energy Credit expires in 2035. Starting in 2023, the expansion to the program will also make claiming credit for energy storage systems easier than ever before.

More information about the new Inflation Reduction Act can be found here. Your local Bourbonnais solar panel company 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 may include tax credits, rebates and more. These solar incentives — which might be provided by your county or municipality, or by the state of Illinois — might be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Bourbonnais

There are many kinds of solar incentives: those provided by local utility companies, those offered by the federal government and those provided by the Illinois government, to name a few. Solar energy utilization has grown enormously in the last 15 years, partially due to these incentives. Talking to your local Bourbonnais solar panel installation expert is the right first step towards making sure you get all the incentives you qualify for when you switch to solar energy.