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

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

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

Solar incentives are intended to make renewable energy usage more affordable via financial incentives for those who install solar panels on their homes. Incentives may include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered federally, while others are provided by the Illinois government or your utility company, county or municipality. Some broad categories of solar incentives include:

• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives might be available to you if you have a solar system that produces more than a specified (generally small) amount of electricity. This category of incentives is typically handled at the state level. You can sell any SRECs you have to your utility company or other buyers, and the money you make is normally 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 federal government.
• Rebates: Rebates, or cash back after a purchase, are normally applied prior to any solar tax credits being calculated. Solar rebates can be provided by your local utility company, by your state or by your county.
• Tax Exemptions: These may come in the form of property tax exemptions, which allow you to exclude the value added by your solar panels when paying property tax on your house. You could also look for exemptions on sales tax at the time of purchase.
• Net Metering: Net metering is an incentive you can get once your solar system is up and running. If you have a net metering agreement with your Calumet utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in other places you may make back a percentage of the value.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some knowledge of. 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 the cost of your solar system.

The ITC is applied to the total cost of solar panel installation, including the panels themselves as well as labor, equipment and accessories. You can claim this credit for panels installed after January 1, 2006 on a primary or secondary residence located in the United States that you own. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum claim amount.

To best understand how the ITC could apply to you, contact your local Calumet solar panel installer and request more information.

In August 2022, the ITC (now referred to as the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. For solar systems installed between January 1, 2022 and December 31, 2032, homeowners can receive a credit equal to 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit expires in 2035. The expansion to the program also makes it easier to get credit for energy storage systems, starting in 2023.

More information about the new Inflation Reduction Act can be found here. Your local Calumet solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it will apply to you.

State & Local Solar Incentives

Federal solar incentives are not your only option; tax credits, rebates and more might also be offered at the state and local level. The incentives — which might be handled 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 Calumet

Solar energy use nationwide has increased enormously in the past 15 years, in part due to the increase in availability of solar incentives. You might receive these incentives from your local utility company, the Illinois government or the federal government. Talking to your local Calumet solar panel installation company is an excellent first step towards getting the most money possible when you switch to solar energy.