2024 Solar Incentives Guide for Elmhurst, IL - Tax Credits & Rebates

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

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

Solar incentives encourage people to switch to renewable energy by providing incentives that lower the financial burden of solar panel installation and use. The incentives might include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are handled 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:

• Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you've signed a net metering agreement with your Elmhurst utility company, it will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this credit is dollar-for-dollar, while in other places you might receive a refund equivalent to a percentage of the value.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are normally handled by your state government. Once your solar panel system meets a predetermined 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 when you purchase solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when calculating property tax for your house.
• Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (This is different from a tax deduction.)
• Rebates: A solar rebate is a partial refund after the purchase of your solar panels. Rebates may be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.

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Federal Solar Incentives

When you think about solar incentives, you likely think of federal incentives first. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit that reduces your taxes by a specified percentage of the money you spend on your solar system.

The ITC can be applied to solar systems installed after January 1, 2006, and allows you to deduct from your taxes a percentage of the total cost of solar panels, labor, accessories and equipment. You can claim this credit for solar panels installed on a primary or secondary residence that you own in the United States. The original amount you could claim was 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum amount you can claim.

Speaking with your local Elmhurst solar panel installation expert is the best way to learn more about how the ITC may apply to your situation.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now dubbed the Clean Energy Credit. The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar installations undertaken between January 1, 2022, and December 31, 2032. After this, the credit percentage will see a slight decrease annually until the program expires in 2035. Starting in 2023, the 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 easiest way to learn more about how the new Clean Energy Credit applies to you is to speak with your local Elmhurst solar panel installation expert directly.

State & Local Solar Incentives

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

Next Steps for Installing Solar in Elmhurst

Solar incentives might be offered by your local utility company, the federal government or the Illinois government. The variety of incentives available has facilitated the nationwide growth of solar energy use in the last 15 years. Your local Elmhurst solar panel installer can help you learn more about which incentives you can apply for, and get you started on the path to switching to renewable energy today.