2023 Solar Incentives Guide for Highland, IL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Highland.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Highland?
Special Assessment for Solar Energy Systems
Solar Renewable Energy Credits
Federal Residential Renewable Energy Tax Credit
The term "solar incentives" generally refers to financial incentives that are in place to encourage the use of renewable energy by making the installation and use of solar panels more affordable. These incentives may include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are provided by the federal government, some by the Illinois government and some by your utility company, county or municipality. Some broad categories of solar incentives include:
- Rebates: Rebates, or partial refunds after a purchase, are typically given before any solar tax credits are calculated. These rebates may be offered by your local utility company, by your county or by your state.
- Net Metering: Net metering is an incentive you can get once your solar panels are up and running. If you have in place a net metering agreement with your Highland utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some locations, this credit is dollar-for-dollar, while in other places you may make back 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.
- Solar Renewable Energy Certificate (SREC): In general, solar systems that produce over a threshold (usually small) amount of electricity can qualify for SRECs or other similar performance-based incentives. SRECs and similar incentives are typically given by your state government. When you receive an SREC, you can sell it to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.
- Tax Exemptions: These might come in the form of property tax exemptions, which would allow you to exclude the value of your solar system when paying property tax on your house. You may also qualify for an exemption on sales tax at the time of purchase.
Federal Solar Incentives
When someone says "solar incentives," you likely think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC provides you with a tax credit for a predetermined percentage of the cost of your solar system.
The ITC applies to solar panels installed on your primary or secondary residence in the United States. The solar system must have been installed on a property you own after January 1, 2006 for you to be eligible for the credit. Initially, the ITC applied to 30% of all system costs (panels, labor, equipment and accessories), although the total amount has fluctuated over the last few years between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the amount you can claim.
Contacting your local Highland solar panel installer is the best way to learn more about how the ITC could apply to you.
In August 2022, the Inflation Reduction Act expanded and extended the ITC, now called the Clean Energy Credit. The Clean Energy Credit runs until 2035. Solar installation projects started after January 1, 2022 and completed by the end of 2032 may qualify for a 30% tax credit; the amount will decrease slightly on a yearly basis until the end of the current program. Beginning in 2023, it will also be easier to obtain credits for energy storage systems under this new program.
Click here to learn more about the new Inflation Reduction Act. The easiest way to understand how the new Clean Energy Credit will apply to you is to reach out to your local Highland solar panel company with your questions.
State & Local Solar Incentives
Tax credits, rebates and more might be provided at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. Certain incentives are ongoing, while others are only 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 Highland
Solar incentives might be provided by your local utlity company, the Illinois government or the federal government. The variety of available solar incentives has facilitated the nationwide growth of solar energy use in the last 15 years. Your local Highland solar panel installation expert can provide you with more details about which incentives you should apply for, and get you on track to switch to renewable energy today.
EcoWatch's Highland, IL Solar Incentives FAQs
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.