2023 Solar Incentives Guide for Lincoln, IL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Lincoln.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Lincoln?
Special Assessment for Solar Energy Systems
Solar Renewable Energy Credits
Federal Residential Renewable Energy Tax Credit
The term "solar incentives" refers to a wide 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. Incentives could include things like discounts, cash back or credit on your utility bill each month. Some incentives are offered federally, while others are provided by the Illinois government or by your specific utility company, county or municipality. Some broad categories of solar incentives include:
- Net Metering: Net metering factors in after your solar panels are up and running. If you have in place a net metering agreement with your Lincoln utility company, it will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in other areas you may get refunded a percentage of the value.
- Solar Renewable Energy Certificate (SREC): In most cases, solar systems that produce over a specific (usually small) amount of electricity will qualify for SRECs or other performance-based incentives. SRECs and similar incentives are typically provided at the state level. You can sell SRECs to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.
- Tax Exemptions: These could come in the form of property tax exemptions, which allow you to exclude the value of your solar system when calculating the taxes you pay on your home. You may also qualify for an exemption on sales tax at the time of purchase.
- 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. If you receive a rebate, that amount will usually be deducted from your total price before tax credits are calculated.
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
Federal Solar Incentives
Federal solar incentives are likely the first thing that comes to mind when thinking about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is the most well-known federal solar incentive. The ITC provides a tax credit for a specific percentage of your solar system's cost.
The ITC covers 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, labor and equipment. This credit can apply towards a solar panel system installed on a primary or secondary residence in the United States that you own. 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.
Your local Lincoln solar panel installer can provide you with more information about the ITC and how it applies to your situation.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as retitling it the Clean Energy Credit). The new Clean Energy Credit is valid until 2035. Homeowners can now receive a 30% credit for solar systems installed between 2022 and 2032. This new credit will then be decreased by a few percentage points every year until it expires. The expansion 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 Lincoln solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it may apply to you.
State & Local Solar Incentives
Some solar incentives are often also provided by state and local governments. Similar to federal incentives, these may include tax credits, rebates and more. Some incentives are ongoing, while others are only available for a limited time. They may be provided by your county or municipality, or by the Illinois government.
Next Steps for Installing Solar in Lincoln
Solar incentives can be provided by the Illinois government, the federal government or your local utility company. The growing number of available solar incentives has contributed to a large increase in solar energy use in the last 15 years. Your local Lincoln solar panel installation company can help you learn more about which incentives you can apply for, and get you feeling good about making the change to renewable energy today.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries (coming 2022)
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
EcoWatch's Lincoln, IL Solar Incentives FAQs
What if I am planning to add a solar system to a rental property, vacation home or commercial property? Will I still qualify for incentives?
Many solar incentives apply to a property you own that is located within the United States, and most secondary residences will fall under this distinction. There may be other solar incentives available for commercial properties, depending on the specifics. We recommend talking to your local solar installer and/or tax professional to best understand what incentives will apply to your specific situation.
If I installed solar panels on my house a few years ago, can I still claim incentives?
You should plan to talk to someone from the company that installed your system — or get in touch with a local Lincoln solar installer — to learn about which incentives you might qualify for. If your solar panels were installed after January 1, 2022, you likely qualify for the recently increased 30% tax credit under the Inflation Reduction Act. Solar panels installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
How much will a solar system save me on my electric bill in Lincoln annually?
When you add solar panels to your house in Lincoln, you can expect to save approximately $626.92 per year, or approximately $11,911.52 over the next 20 years.
Who installs solar panels near me?
To find the right solar panel installer for you, check out our guide to the best solar companies in Lincoln.
Can I receive incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order your incentives will be applied in may vary depending on which incentives you are claiming but typically yes, you can claim multiple types of incentives for your solar project. Speak to your solar installer or a local tax professional to confirm you are claiming all the incentives you are eligible for and applying them in the correct order.
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.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.