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

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

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

The phrase "solar incentives" refers to financial incentives implemented by the government and by solar companies to encourage the use of renewable energy by making solar panels more affordable. Incentives could include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered federally, while others are handled by the state of Illinois or by your utility company, county or municipality. Some broad categories of solar incentives include:

• Tax Exemptions: These may come in the form of property tax exemptions, which would allow you to exclude the value added by your solar panels when paying taxes on your home. They may also include exemptions on sales tax at the time of purchase.
• Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar system. Rebates could be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
• Tax Credits: Tax credits decrease, dollar-for-dollar, how much income tax you owe the government. Tax credits are different from tax deductions.
• Net Metering: Don't forget to talk with your Crest Hill utility company about signing a net metering agreement. This will allow 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 and other similar performance-based incentives are usually handled by your state government. Once your solar panel system meets a predetermined threshold (typically a small amount of energy production), you are eligible to receive SRECs that you can then sell to your utility company or other buyers. The money you receive from the sale is generally considered part of your taxable income.

Federal Solar Incentives

When you hear the term "solar incentives," federal incentives might be the first thing that comes to mind. A federal incentive that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a predetermined percentage of your solar system's cost.

The ITC was originally for 30% of the total cost of solar system installation, although that number has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total cost of installation includes the panels themselves as well as the cost of labor, accessories and equipment. There is no maximum amount you can claim. The ITC applies to solar panels installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.

Your local Crest Hill solar panel installer can give you 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 retitling it the Clean Energy Credit). For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners may be eligible for a credit equal to 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit expires in 2035. Starting in 2023, the program expansion will also make claiming credit for energy storage systems easier than ever before.

Click here to learn more about the new Inflation Reduction Act. Your local Crest Hill solar panel installers are the best people to answer your questions about the new Clean Energy Credit and how it may apply to you.

State & Local Solar Incentives

Some solar incentives are often also provided by state and local governments. Like with federal incentives, these might include rebates, tax credits and more. Certain incentives are ongoing, while others are available for a limited time. Solar incentives might be given by the Illinois government, or by your county or municipality.

Next Steps for Installing Solar in Crest Hill

Nationwide solar energy use has gone up significantly in the past 15 years, in part due to the increase in availability of solar incentives. You can obtain these incentives from your local utility company, the Illinois government or the federal government. We suggest talking to your local Crest Hill solar installation company for more information about these incentives and to ensure that you're getting the largest number possible for your solar system.