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

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

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

The phrase "solar incentives" covers a wide range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Solar incentives can include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are handled by the federal government, some by the state of Illinois and some by your specific utility company, county or municipality. Categories of solar incentives include:

• Rebates: Solar rebates can be offered by your county or state, or by your local utility company. These rebates are essentially cash back that is applied after you purchase a solar system and before tax credits are calculated.
• Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
• Net Metering: You can sign a net metering agreement with your East Moline utility company that will apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then deduct this value from your monthly utility bill.
• Tax Exemptions: Your solar system may qualify for both sales tax and property tax exemptions. Sales tax exemptions are effective at the time of purchase. Property tax exemptions let you ignore the value that solar panels add when you are calculating property taxes on your house.
• Solar Renewable Energy Certificate (SREC): SRECs and other similar performance-based incentives are normally handled at the state level. Once your solar panel system meets a certain threshold (generally 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 make from the sale is generally considered part of your taxable income.

Federal Solar Incentives

When someone says "solar incentives," you likely think of federal incentives first. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a specified percentage of your solar system's cost.

The ITC covers solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, equipment, labor and accessories. This credit can be claimed on a solar panel system installed on a primary or secondary residence that you own in the United States. The original claim amount 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 claim amount.

To more fully understand how the ITC could apply to your situation, contact your local East Moline solar panel installer and request more information.

In August 2022, the Inflation Reduction Act expanded and extended the ITC, now dubbed the Clean Energy Credit. Homeowners can now receive a credit equal to 30% of the total solar system installation costs for projects started after January 1, 2022 and completed before the end of 2032. The credit percentage will then decrease on a yearly basis 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. The best way to fully understand how the new Clean Energy Credit applies to you is to get in touch with your local East Moline solar panel installers.

State & Local Solar Incentives

Some solar incentives are often also provided at the state and local level. As with federal incentives, these may include rebates, tax credits and more. These incentives may be handled by your county or municipality, or by the Illinois government. Some incentives may be ongoing, while others are available for a limited time.

Next Steps for Installing Solar in East Moline

There are many kinds of solar incentives: those provided by local utility companies, those provided by the federal government and those provided by the Illinois government, to name a few. Solar energy use has grown tremendously in the last 15 years, thanks to these incentives. Talking to your local East Moline solar panel installation company is an excellent first step towards getting all the incentives you qualify for when you switch to solar energy.