2023 Solar Incentives Guide for Columbia, IL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Columbia.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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Updated March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Columbia?
Special Assessment for Solar Energy Systems
Solar Renewable Energy Credits
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are meant to encourage homeowners to switch to renewable energy by offering financial incentives that lower the burden of solar panel installation and use. You may be eligible for different kinds of incentives, including discounts, cash back or monthly utility bill credits, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the Illinois government and others from the federal government. Categories of solar incentives include:
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (This is different from a tax deduction.)
- Tax Exemptions: Your solar panel system 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 added value of the solar panels when you are calculating property taxes on your home.
- Rebates: Solar rebates might be provided by your local utility company, or by your county or state. These rebates work as partial refunds that are applied after your purchase of solar panels and before tax credits are calculated.
- Net Metering: Don't forget to talk to your Columbia utility company about signing a net metering agreement. This allows you to get a credit towards your utility bill every month 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 and similar other performance-based incentives might be available to you if your solar system produces over a specified (typically small) amount of electricity. This category of incentives is generally 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 generally considered part of your taxable income.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some knowledge of. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit equal to a predetermined percentage of the money you spend installing solar panels.
The ITC can be applied to solar systems installed after January 1, 2006 and under this program you can deduct from your taxes a percentage of the total cost of solar panels, accessories, labor and equipment. You can claim this credit for solar panels installed on a primary or secondary residence that you own in the United States. The original amount you could claim was 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum amount you can claim.
Your local Columbia 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 expanded and extended the ITC, now dubbed the Clean Energy Credit. For solar systems installed between January 1, 2022 and December 31, 2032, homeowners can apply for a credit equal to 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit expires in 2035. Starting in 2023, it will also be easier to get credits for energy storage systems with the new act.
Click here to learn more about the new Inflation Reduction Act. Your local Columbia solar panel company can answer any questions you have and explain how the new Clean Energy Credit will apply to you.
State & Local Solar Incentives
Not all solar incentives are federal; rebates, tax credits and more may be offered at the state and local level. Some incentives are offered for only a limited time, while others are ongoing. Your local incentives may come from your county or municipality, or from the Illinois government.
Next Steps for Installing Solar in Columbia
Nationwide solar energy use has increased enormously in the last 15 years, in part thanks to the proliferation of solar incentives. You might receive these incentives from the Illinois government, the federal government or your local utility company. When you're ready to switch over to solar energy, calling your local Columbia solar panel installation expert is an excellent place to start.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries (coming 2022)
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
EcoWatch's Columbia, IL Solar Incentives FAQs
How can I learn if I qualify for solar incentives?
It's a good idea to talk to your local Columbia solar installer for a better understanding of which incentives your project may qualify for. In most cases, solar incentives apply to new solar systems installed on a property you own (in the U.S.) between the dates specified by the incentive. Some incentives, like those provided by the Illinois government, may have other requirements.
If I already have solar panels, can I still claim incentives?
If your solar panels were installed after January 1, 2022, you may qualify for the recently increased 30% tax credit under the Inflation Reduction Act. If you installed your system between 2006 and 2021, you might qualify for a tax credit between 26% and 30%, depending on the exact installation date. Speaking with a representative from the company that installed your solar system, or any local Columbia solar installer, can help you learn what incentives you can apply for.
What are some environmental benefits of adding solar panels to my house?
Solar energy is renewable — by changing where you get your energy, you help reduce the strain on our planet's resources. You can also reduce the CO2 emissions from your home by 500 pounds a year, or roughly 13,000 pounds over 20 years.
I want to trade in my old appliances for ones that are more energy-efficient. Are there any benefits I can apply for?
Under the new Inflation Reduction Act, there are several new financial incentives that are available when you make eco-friendly improvements to your home. More details about these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I qualify for incentives both towards the up-front cost of solar panels, and later as reimbursement?
Yes, you can claim both tax credits and rebates towards the cost of solar panels. Depending on precisely which incentives you are eligible for, they may apply in a different order. Make sure that you speak with your solar installer or a local tax professional to verify that you are claiming the correct incentives and getting the most money possible.
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.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.