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

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

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

Solar incentives are intended to make renewable energy usage more affordable through financial incentives to help people install solar panels on their homes. These incentives might include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are offered by the federal government, some by the Illinois government and some by your utility company, county or municipality. Some broad categories of solar incentives include:

• Rebates: Solar rebates may be provided by your local utility company, or by your county or state. These rebates work as partial refunds that are applied after you purchase solar panels and before tax credits are calculated.
• Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.
• Net Metering: Net metering is an incentive you can get once your solar panels are up and running. If you've signed a net metering agreement with your Burr Ridge utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some places, this credit is dollar-for-dollar, while in others you may receive a refund equivalent to a percentage of the value.
• Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce more than a predetermined (normally small) amount of electricity will qualify for SRECs or other performance-based incentives. SRECs and similar incentives are typically offered at the state level. 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: These can come in the form of property tax exemptions, which would allow you to ignore the value of your solar system when calculating the taxes you pay on your home. You may also qualify for an exemption on sales tax at the time of purchase.

Federal Solar Incentives

When you think about solar incentives, you likely think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is probably the most well-known federal solar incentive. The ITC allows you to claim a tax credit for a set percentage of your solar system's cost.

The ITC applies to solar panels installed after January 1, 2006 on a primary or secondary residence in the United States that you own. Initially, the credit applied to 30% of the total cost — for panels, labor, accessories and equipment — although it may range from 26-30%, depending on when your solar project was undertaken. 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 Burr Ridge solar panel installer to get more information.

In August 2022, the ITC (now referred to as the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. The Clean Energy Credit re-raises the credit up to 30% for solar installations undertaken between January 1, 2022 and December 31, 2032. After 2032, the percentage will be reduced slightly each year until the end of the program in 2035. Starting in 2023, the expansion to the program will also make it easier to get credit for energy storage systems.

More information about the new Inflation Reduction Act can be found here. The best way to fully understand how the new Clean Energy Credit will apply to you is to reach out to your local Burr Ridge solar panel company with your questions.

State & Local Solar Incentives

Some solar incentives are often also provided by state and local governments. Similar to federal incentives, these may include rebates, tax credits and more. These solar incentives — which may be provided by the state of Illinois, or by your county or municipality — might be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Burr Ridge

You can apply for solar incentives from the Illinois government and the federal government, as well as from your local utility company. The increased availability of solar initiatives in the past 15 years has helped increase nationwide solar energy use enormously. If you're ready to switch over to solar energy, talking to your local Burr Ridge solar panel installation expert is an excellent place to start.