2023 Solar Incentives Guide for Carbondale, IL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Carbondale.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Carbondale?
Special Assessment for Solar Energy Systems
Solar Renewable Energy Credits
Federal Residential Renewable Energy Tax Credit
Solar incentives are designed to make renewable energy usage more affordable through financial incentives for individuals who install solar panels on their homes. You might qualify for several kinds of incentives, such as cash back, discounts or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the Illinois government and others from the federal government. Some broad categories of solar incentives include:
- Tax Exemptions: These might come in the form of property tax exemptions, which can let you exclude the value of your solar system when calculating the taxes you pay on your house. You may also qualify for an exemption on sales tax at the time of purchase.
- Rebates: A solar rebate is a partial refund given after you've purchased your solar system. These may be offered by your local utility company, your state or your county. The rebates are usually applied before tax credits are calculated.
- Net Metering: Net metering factors in once your solar system is up and running. If you've signed a net metering agreement with your Carbondale utility company, the company 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 other places you might make back a percentage of the value.
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
- Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that normally counts as part of your taxable income. Typically, a certain (small) threshold of energy production must be met before your solar system is eligible for SRECs or other performance-based incentives. These kinds of incentives are normally handled by your state government.
Federal Solar Incentives
Federal solar incentives are likely to be the first thing that comes to mind when thinking about solar incentives. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit that reduces your taxes by a specified percentage of the money you spend on your solar system.
The ITC can be applied to solar panels 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, accessories, equipment and labor — although that amount may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the claim amount.
Your local Carbondale solar panel installer can provide you with more information about the ITC and how it may apply to your situation.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). Homeowners can now receive a credit equal to 30% of the total costs of solar system installation for projects started after January 1, 2022 and completed before the end of 2032. The credit percentage will then decrease on a yearly basis until the Clean Energy Credit ends in 2035. Starting in 2023, it will also be easier to claim credits for energy storage systems under this new program.
Click here to learn more about the new Inflation Reduction Act. Your local Carbondale solar panel company can answer your questions and explain how the new Clean Energy Credit will apply to you.
State & Local Solar Incentives
Rebates, tax credits and more can be claimed at multiple levels. On top of federal solar incentives, there are often state and local ones, too. These incentives — which might be handled by the state of Illinois, or by your county or municipality — may be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Carbondale
You can receive solar incentives from the federal government and the Illinois government, as well as from your local utility company. The increased availability of solar initiatives over the last 15 years has helped increase solar adoption nationwide. Your local Carbondale solar panel installation company can help you learn more about which incentives you should apply for, and get you on track to switch to renewable energy today.
EcoWatch's Carbondale, IL Solar Incentives FAQs
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.