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

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

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

The phrase "solar incentives" refers to a range of financial incentives put in place to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. You may qualify for various kinds of incentives, such as discounts, cash back or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the Illinois government and others from the federal government. Some broad categories of solar incentives include:

• Net Metering: Net metering factors in once your solar panels are up and running. If you've signed a net metering agreement with your Galesburg utility company, the company will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some areas, this is a dollar-for-dollar credit, while in other areas you might make back a percentage of the value.
• Rebates: Rebates, or partial refunds after a purchase, are typically given before any solar tax credits are calculated. Rebates may be given by your local utility company, by your county or by your state.
• Tax Exemptions: Your solar system might qualify for both sales tax and property tax exemptions. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions let you exclude the value that solar panels add when calculating property taxes on your house.
• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives might be available to you if your solar system produces more than a specified (generally small) amount of electricity. This category of incentives is usually handled by the state government. You can sell your SRECs to your utility company or other buyers, and the money you make is normally considered part of your taxable income.
• Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.

Federal Solar Incentives

When thinking about solar incentives, you probably think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is probably the most commonly known federal solar incentive. The ITC allows you to claim a tax credit for a specific percentage of your solar system's cost.

The ITC can be applied to solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, accessories, labor and equipment. You can receive 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.

To better understand exactly how much money the ITC could save you, talk to your local Galesburg solar panel installation expert.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now called the Clean Energy Credit. The Clean Energy Credit lasts until 2035. Any solar installation project that is completed between January 1, 2022 and December 31, 2032 may qualify for a 30% tax credit. This amount will be decreased slightly each year until the current program ends. The program expansion 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. To fully understand how the new Clean Energy Credit applies to you, speak with your local Galesburg solar installation company.

State & Local Solar Incentives

Rebates, tax credits and more can be provided at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. Incentives may be handled by your county or municipality, or by the state of Illinois. Certain incentives may be available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in Galesburg

You can apply for and receive solar incentives from the federal government and the Illinois government, as well as from your local utility company. The increased availability of solar initiatives over the last 15 years has helped greatly increase nationwide adoption of solar energy. Reaching out to your local Galesburg solar panel installation company is an excellent first step towards making sure you get all the incentives you qualify for when you switch to solar energy.