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

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

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

Solar incentives are intended to make renewable energy usage more affordable through financial incentives to help people install solar panels on their homes. Incentives may include things like discounts, cash back or monthly utility bill credits. Some incentives are offered by the federal government, while others are offered by the Illinois government or by your specific utility company, county or municipality. Some solar incentives you might qualify for are:

• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.
• Rebates: Solar companies may help you claim a rebate, or partial refund of your purchase, for your solar panels. Counties or states will also sometimes offer limited-time rebates. If you receive a rebate, that amount will usually come off your total price before tax credits are calculated.
• Tax Exemptions: Your solar panels could qualify for both sales tax and property tax exemptions. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to exclude the value that solar panels add when you are calculating property taxes on your house.
• Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce over a threshold (usually small) amount of electricity can qualify for SRECs or similar performance-based incentives. SRECs and performance-based incentives in general are typically given at the state level. You can sell SRECs to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.
• Net Metering: Net metering factors in once your solar panels are up and running. If you've signed a net metering agreement with your Deerfield utility company, it will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some areas, this is a dollar-for-dollar credit, while in other areas you might receive a refund equivalent to a percentage of the value.

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 offers a tax credit for a specific percentage of the cost of your solar system.

The ITC applies to a solar system installed on your primary or secondary residence in the United States. The solar system must 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 installation costs (panels, equipment, labor and accessories), although the covered amount has fluctuated slightly over time between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the amount you can claim.

Speaking with your local Deerfield solar panel installer is the best way to learn more about how the ITC applies to you.

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. 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.

More information about the new Inflation Reduction Act can be found here. Your local Deerfield 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

Rebates, tax credits and more might be provided at multiple levels. Along with federal solar incentives, there are often state and local ones, too. Some incentives are ongoing, while others are available for a limited time. They might be given by your county or municipality, or by the Illinois government.

Next Steps for Installing Solar in Deerfield

There are many types of solar incentives: those offered by local utility companies, those offered by the federal government and those offered by the Illinois government, to name a few. The use of solar energy has increased tremendously in the last 15 years, partially due to these incentives. When you're prepared to switch over to solar energy, calling your local Deerfield solar panel installation expert is an excellent place to start.