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

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

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

Solar incentives are meant to encourage people to switch to renewable energy by providing financial incentives meant to lower the burden of solar panel installation and use. You might be eligible for several kinds of incentives, such as discounts, cash back or credit towards your monthly utility bill, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of Illinois and others from the federal government. Some broad categories of solar incentives include:

• Solar Renewable Energy Certificate (SREC): SRECs can be sold to your utility company (or other buyers) for cash that typically becomes part of your taxable income. Typically, a certain (small) threshold of energy production must be met before your solar system can earn SRECs or similar performance-based incentives. These kinds of incentives are generally handled at the state level.
• Tax Exemptions: Your solar panels could qualify for exemptions on both sales and property tax. Sales tax exemptions are applied at the time of purchase. Property tax exemptions let you exclude the value added by your solar panels when calculating property taxes on your home.
• Net Metering: Be sure to talk to your Elburn utility company about signing a net metering contract. This will allow you to receive credit towards your utility bill every month for the value of excess energy generated by your solar panels. You could receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
• Rebates: Solar rebates can be offered by your local utility company, or by your county or state. These rebates work as partial refunds that are applied after you purchase a solar system and before tax credits are calculated.

Federal Solar Incentives

Federal solar incentives are likely the first thing that you think of when thinking about solar incentives. A federal incentive that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a certain percentage of the cost of your solar system.

The ITC can be applied to solar systems installed after January 1, 2006 on a primary or secondary residence in the United States that you own. The credit initially covered 30% of the total cost — for panels, equipment, accessories and labor — although it may range from 26-30%, depending on the installation date of your solar system. There is no cap on the claim amount.

To better understand exactly how much the ITC could save you, contact your local Elburn solar panel installation expert.

The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called 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. This percentage will decrease annually after 2032 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 Elburn solar panel company can answer your questions and explain how the new Clean Energy Credit will apply to you.

State & Local Solar Incentives

Some solar incentives are often also provided at the state and local level. Similar to federal incentives, these might include rebates, tax credits and more. Incentives may be offered by your county or municipality, or by the state of Illinois. Certain incentives are available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in Elburn

The expanding number of solar incentives available has helped tremendously increase the adoption of solar energy nationwide over the past 15 years. You can get solar incentives from your local utility company, the federal government or the Illinois government. Reaching out to your local Elburn solar panel installation company is the best first step towards getting all the incentives you qualify for when you switch to solar energy.