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

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

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

Solar incentives encourage homeowners to make the switch to renewable energy by offering incentives meant to lower the financial burden of solar panel installation and use. Various types of incentives, like discounts, cash back or monthly utility bill credits, may be available to you. Certain incentives may be offered by the Illinois government, by your utility company or by county or municipality, while other incentives are federal. Types of solar incentives might include:

• Net Metering: Net metering is an incentive you can get after your solar system is up and running. If you have a net metering agreement with your Homewood utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some places, this credit is dollar-for-dollar, while in other places you might be refunded a percentage of the value.
• Tax Exemptions: These could come in the form of property tax exemptions, which let you exclude the value added by your solar panels when paying property tax on your house. You may also qualify for an exemption on sales tax at the time of purchase.
• Tax Credits: Tax credits decrease, dollar-for-dollar, the total amount of tax you owe the federal government. These differ from tax deductions.
• Rebates: Solar companies may help you claim a rebate, or partial refund after purchase, for your solar panels. Counties or states will also sometimes offer limited-time rebates. The value of a rebate will usually come off the total price before tax credits are calculated.
• 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. Generally, there is a small threshold of energy production to meet before your solar system is eligible for SRECs or other performance-based incentives. These kinds of incentives are generally handled by your state government.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some knowledge of. A federal incentive that most people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a specified percentage of your solar system's cost.

The ITC is applied to the total cost of solar panel installation, including the panels themselves as well as accessories, labor and equipment. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence that you own, as long as it is located in the United States. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum claim amount.

To more fully understand how the ITC will apply to you, contact your local Homewood solar panel installation expert 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 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 be decreased slightly on a yearly basis until the end of the current program. Starting in 2023, it will also be easier to qualify for credits for energy storage systems under this new program.

Click here to learn more about the new Inflation Reduction Act. Your local Homewood solar panel company is the best resource for answering your questions about the new Clean Energy Credit and how it may apply to you.

State & Local Solar Incentives

There are often also state solar incentives in addition to those provided by the federal government. Rebates, tax credits and more may be available at a more local level. Certain incentives are ongoing, while others are offered for only a limited time. Local solar incentives might come from your county or municipality, or from the Illinois government.

Next Steps for Installing Solar in Homewood

You can apply for and receive solar incentives from the federal government and the Illinois government, as well as from your local utility company. This increase in availability of solar initiatives in the past 15 years has helped greatly increase nationwide adoption of solar energy. Your local Homewood solar panel installation expert can help you learn more about which incentives you can apply for, and get you on track to switch to renewable energy today.