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

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

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

Solar incentives are intended to make renewable energy usage more affordable via financial incentives for individuals who install solar panels on their homes. Various types of incentives, such as discounts, cash back or monthly utility bill credits, may be available to you. Some incentives may be offered by the state of Illinois, by your utility company or by county or municipality, while other incentives are federal. Types of solar incentives might include:

• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are generally handled by your state government. Once your solar panel system meets a certain threshold (normally a small amount of energy production), you can receive SRECs that can then be sold to your utility company or other buyers. The money you make is usually considered part of your taxable income.
• Net Metering: Net metering becomes relevant once your solar system is up and running. If you've signed a net metering agreement with your La Grange utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in other places you may receive a refund equivalent to a percentage of the value.
• Rebates: Some solar companies will help you claim a rebate, or partial refund of your purchase, for your solar panels. Counties or states will also offer limited-time rebates at various times. If you receive a rebate, that amount will usually be deducted from your total price before any tax credits are calculated.
• Tax Credits: Tax credits lower, dollar-for-dollar, the total amount of tax you owe the government. These are different from tax deductions.
• Tax Exemptions: Tax exemptions can come in two forms. The first is sales tax exemption, applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to ignore the added value of your solar system when paying property tax on your house.

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Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some familiarity with. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit equal to a certain percentage of the money you spend on your solar system.

The ITC was originally for 30% of the cost of solar system installation, although it has fluctuated slightly over time between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total cost of installation includes the panels themselves as well as the cost of equipment, labor and accessories. There is no maximum amount you can claim. The ITC applies to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.

To more fully understand how the ITC may apply to your situation, speak to your local La Grange solar panel installer and request more information.

The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called 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 percentage will be reduced slightly each year until the program expires in 2035. The expansion to the program also makes claiming credit for energy storage systems easier than ever before, starting in 2023.

More information about the new Inflation Reduction Act can be found here. Your local La Grange solar panel installer can answer your questions and explain how the new Clean Energy Credit applies to you.

State & Local Solar Incentives

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

Next Steps for Installing Solar in La Grange

There are many kinds of solar incentives: those provided by local utility companies, those provided by the federal government and those offered by the Illinois government, to name a few. The use of solar energy has grown tremendously in the last 15 years, partially due to these incentives. When you're ready to switch over to solar energy, reaching out to your local La Grange solar panel installation expert is an excellent place to start.