2025 Solar Incentives Guide for Canton, IL - Tax Credits & Rebates

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

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

Solar incentives are designed to make renewable energy usage more affordable via financial incentives for those who install solar panels on their homes. You might be eligible for various kinds of incentives, such as cash back, discounts or credit towards your monthly utility bill, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of Illinois and others from the federal government. Categories of solar incentives include:

• Rebates: Solar rebates may be offered by your state or county, or by your local utility company. These rebates are essentially cash back that is applied after you purchase a solar system and before tax credits are calculated.
• Tax Credits: Tax credits lower, dollar-for-dollar, how much income tax you owe the government. These are different from tax deductions.
• Net Metering: Net metering factors in once your solar system is up and running. If you've signed a net metering agreement with your Canton utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in others you might receive a refund equivalent to a percentage of the value.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are normally handled by your state government. Once your solar panel system meets a certain threshold (normally a small amount of energy production), you can receive SRECs that you can then sell to your utility company or other buyers. The money you receive from the sale is usually considered part of your taxable income.
• Tax Exemptions: Your solar panels may qualify for exemptions on both sales and property tax. Sales tax exemptions are applied at the time of purchase. Property tax exemptions allow you to ignore the value added by your solar panels when calculating property taxes on your house.

Federal Solar Incentives

When someone says "solar incentives," you likely think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC offers a tax credit for a predetermined 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 has to have been installed after January 1, 2006, on a property owned by you for you to be eligible for the credit. The ITC originally paid out 30% of all system costs (panels, accessories, labor and equipment), although the covered amount has fluctuated 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 claim amount.

Your local Canton solar panel installer can provide you with more information about the ITC and how it may apply to your situation.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now referred to as the Clean Energy Credit. With the new provisions, solar installation projects begun after January 1, 2022, and finished by December 31, 2032, can qualify for a 30% tax credit. The amount of the credit will then see a slight annual decrease until the end of the current Clean Energy Credit in 2035. Starting in 2023, the expansion will also make it easier to get credit for energy storage systems.

Click here to learn more about the new Inflation Reduction Act. To better understand how the new Clean Energy Credit applies to you, reach out to your local Canton solar installation expert.

State & Local Solar Incentives

There are often also state solar incentives in addition to those provided by the federal government. Rebates, tax credits and more can be offered at a more local level. Certain incentives are ongoing, while others are offered for only a limited time. These local incentives might come from your county or municipality, or from the Illinois government.

Next Steps for Installing Solar in Canton

You can apply for and receive solar incentives from the federal government and the Illinois government, as well as from your local utility company. This increase in availability of solar initiatives in the past 15 years has helped greatly increase nationwide adoption of solar energy. It is a good idea to talk to your local Canton solar installation company for more information about these incentives and to be sure that you're getting all the money you can for your solar panels.