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

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

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

Solar incentives are designed to encourage homeowners to make the switch to renewable energy by offering financial incentives meant to lower the burden of solar panel installation and use. These incentives might include upfront discounts, cash back or monthly credits towards your utility bill. Some incentives are given by the federal government, some by the Illinois government and some by your specific utility company, county or municipality. Some solar incentives you might qualify for are:

• Solar Renewable Energy Certificate (SREC): SRECs can be sold to your utility company (or other buyers) for cash that normally counts as part of your taxable income. Generally, there is a small threshold of energy production to meet before your solar system is eligible for SRECs or other performance-based incentives. Incentives like these are generally handled by your state government.
• Net Metering: Net metering becomes relevant once your solar panels are up and running. If you have in place a net metering agreement with your Dolton utility company, it will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some places, this credit is dollar-for-dollar, while in others you might receive a refund equivalent to a percentage of the value.
• Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar panels. Property tax exemptions allow you to exclude the added value of your solar system when you're calculating how much property tax you need to pay on your house.
• Rebates: Solar rebates may be offered by your state or county, or by your local utility company. These rebates are essentially partial refunds that are applied after you purchase solar panels and before tax credits are calculated.
• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the federal government.

Federal Solar Incentives

When someone says "solar incentives," you likely think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is the best-known federal solar incentive. The ITC provides you with a tax credit for a specific percentage of the cost of your solar system.

The ITC applies to the value of solar panels installed on your primary or secondary residence in the United States. The solar system has to have been installed on a property you own after January 1, 2006 for you to claim the credit. Initially, the ITC applied to 30% of all system costs (panels, accessories, equipment and labor), 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 claim amount.

Your local Dolton solar panel installer can offer more information about the ITC and how it may apply to your situation.

The Inflation Reduction Act, passed in August 2022, added more provisions 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 can receive a credit equal to 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit expires in 2035. The program expansion also makes it easier to get credit for energy storage systems, starting in 2023.

Click here to learn more about the new Inflation Reduction Act. The best way to understand how the new Clean Energy Credit applies to you is to talk with your local Dolton solar panel installers.

State & Local Solar Incentives

Some solar incentives may be offered at the local or state level. Similar to federal incentives, these could include tax credits, rebates and more. These incentives — which might be handled by your county or municipality, or by the state of Illinois — may be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Dolton

Solar incentives may be offered by the federal government, the Illinois government or your local utility company. The variety of incentives available has facilitated the nationwide growth of solar energy use in the last 15 years. If you're prepared to make the change to solar energy, talking to your local Dolton solar panel installation expert is a great first step.