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

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

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. You may qualify for different types of incentives, including cash back, discounts or monthly utility bill credits, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of Illinois and others from the federal government. You might qualify for any of the following types of solar incentives:

• Tax Exemptions: Your solar panel system might qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to ignore the value that solar panels add when you are calculating property taxes on your home.
• Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.
• Rebates: Your solar installer might help you claim a rebate, or partial refund after purchase, for your solar system. States or counties will also sometimes offer limited-time rebates. The value of a rebate will usually come off your total price before tax credits are calculated.
• Solar Renewable Energy Certificate (SREC): SRECs and other similar performance-based incentives are typically handled by your state government. Once your solar panel system meets the threshold (normally a small amount of energy production), you can receive SRECs that you can then sell to your utility company or other buyers. The money you receive is usually considered part of your taxable income.
• Net Metering: Net metering is an incentive you can get once your solar panels are up and running. If you've signed a net metering agreement with your Fairview Heights utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, 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

When people think of solar incentives, federal incentives might be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is probably the most well-known federal solar incentive. The ITC offers a tax credit for a specific percentage of your solar system's cost.

The ITC applies towards solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, accessories, equipment and labor. This credit can apply towards 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 claim amount.

To better understand how the ITC may apply to your situation, call your local Fairview Heights solar panel installer and request more information.

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. The Clean Energy Credit has increased the current credit up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. After 2032, the credit percentage will be reduced slightly each year until the end of the program in 2035. The expansion to the program also makes credits for energy storage systems even easier to claim, beginning in 2023.

More information about the new Inflation Reduction Act can be found here. The best way to understand how the new Clean Energy Credit might apply to you is to talk with your local Fairview Heights solar panel installers.

State & Local Solar Incentives

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

Next Steps for Installing Solar in Fairview Heights

Solar incentives can be offered by the Illinois government, the federal government or your local utility company. The large number of incentives available has helped nationwide use of solar energy increase greatly in the last 15 years. When you're prepared to make the switch to solar energy, talking to your local Fairview Heights solar panel installation expert is an excellent place to start.