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

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

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

Solar incentives mitigate the cost of installing solar panels on your home. This category of financial incentives is designed to encourage more homeowners to make the switch to renewable energy. These incentives might include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are provided by the federal government, some by the state of Illinois and some by your utility company, county or municipality. Types of solar incentives might include:

• Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (This is different from a tax deduction.)
• Rebates: Rebates, or partial refunds after a purchase, are typically applied prior to any solar tax credits being calculated. Solar rebates can be offered by your local utility company, by your county or by your state.
• Solar Renewable Energy Certificate (SREC): SRECs and other similar performance-based incentives are usually handled at the state level. Once your solar panel system meets the threshold (usually a small amount of energy production), you are eligible to receive SRECs that can then be sold to your utility company or other buyers. The money you make is generally considered part of your taxable income.
• Tax Exemptions: Tax exemptions may come in one of two forms. The first is sales tax exemption, which is applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to ignore the value added by your solar system when paying property tax on your house.
• Net Metering: You may be able to sign a net metering contract with your Crestwood utility company. This agreement may apply to all or a percentage of the excess electricity that is generated by your solar panels. Your utility company will then deduct this value from your utility bill each month.

Federal Solar Incentives

Federal solar incentives are likely to be the first thing that comes to mind when thinking about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is likely the most commonly known federal solar incentive. The ITC allows you to claim a tax credit for a specific percentage of the cost of your solar system.

The ITC applies to the total cost of solar system installation, including the panels themselves as well as labor, accessories and equipment. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence located in the United States that you own. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum claim amount.

Speaking with your local Crestwood solar panel installer is the best way to learn more about how the ITC applies 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). For solar systems installed between January 1, 2022 and December 31, 2032, homeowners can apply for a credit for 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit ends in 2035. Starting in 2023, the expansion will also make it easier to get credit for energy storage systems.

More information about the new Inflation Reduction Act can be found here. Your local Crestwood solar panel installers are the best people to answer your questions about the new Clean Energy Credit and how it will apply to you.

State & Local Solar Incentives

In addition to those provided at the federal level, there are often also state solar incentives. Tax credits, rebates and more might be available at a more local level. Some incentives are ongoing, while others are offered for only a limited time. These local incentives could come from your county or municipality, or from the Illinois government.

Next Steps for Installing Solar in Crestwood

There are many kinds of solar incentives: those offered by local utility companies, those offered by the Illinois government and those offered by the federal government, to name a few. Solar energy use has increased enormously in the last 15 years, partially thanks to these incentives. Reach out to your local solar panel installer today to find out more information and to save as much money as possible on a solar system for your Crestwood home.