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

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

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

Solar incentives are designed to mitigate the cost of installing a solar panel system on your home. Financial incentives like these are designed to encourage more homeowners to make the switch to renewable energy. Different kinds of incentives, like cash back, discounts or monthly utility bill credits, may be available to you. Certain incentives may be handled by the state of Illinois, by your utility company or by county or municipality, while others are federal. You might qualify for any of the following types of solar incentives:

• Tax Exemptions: Tax exemptions may come in two forms. First, there is sales tax exemption, which is applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to ignore the added value of your solar system when calculating property tax for your home.
• Rebates: Solar rebates can be offered by your local utility company, or by your state or county. These rebates work as partial refunds that are applied after you pay for a solar system and before tax credits are calculated.
• Net Metering: Don't forget to talk to your Cahokia 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 your solar panels generate. You may receive either a dollar-for-dollar credit or a percentage of the value.
• Solar Renewable Energy Certificate (SREC): SRECs can be sold to your utility company (or other buyers) for money that is generally considered part of your taxable income. Typically, there is a small threshold of energy production to meet before your solar system is eligible for SRECs or similar performance-based incentives. These kinds of incentives are generally handled by your state government.
• 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.)

Federal Solar Incentives

When thinking about solar incentives, federal incentives may be the first thing that comes to mind. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a percentage of your solar system's cost.

The ITC can be applied to a solar system installed on your primary or secondary residence in the United States. The solar system must have been installed after January 1, 2006 on a property owned by you for you to claim the credit. The ITC initially covered 30% of all installation costs (panels, accessories, equipment and labor), although the total 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 amount you can claim.

To know exactly how much money the ITC could save you, speak with your local Cahokia solar panel installer.

The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). The Clean Energy Credit is valid until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit. The amount will be decreased slightly each year until the end of the current program. The expansion also makes credits for energy storage systems even easier to claim, beginning in 2023.

More information about the new Inflation Reduction Act can be found here. Your local Cahokia solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it applies to you.

State & Local Solar Incentives

Some solar incentives may be provided at the state and local level. Like with federal incentives, these can include tax credits, rebates and more. Certain incentives are ongoing, while others are only available for a limited time. They may be offered by your county or municipality, or by the Illinois government.

Next Steps for Installing Solar in Cahokia

You can receive 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. It is a good idea to talk to your local Cahokia solar installer for more information about these incentives and to be sure that you're getting the largest number possible for your solar panels.