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

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

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

Solar incentives mitigate the cost of installing solar panels on your home. Financial incentives like these are intended to encourage more Americans to convert their home partially or fully to renewable energy. Incentives can include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered by the federal government, while others are provided by the state of Illinois or your specific utility company, county or municipality. Types of solar incentives might include:

• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are generally handled by your state government. Once your solar system meets a certain threshold (usually a small amount of energy production), you are eligible to receive SRECs that you can then sell to your utility company or other buyers. The money you make is generally considered part of your taxable income.
• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
• Net Metering: Net metering becomes relevant after your solar panels are up and running. If you have a net metering agreement with your Macomb utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in other areas you may get refunded a percentage of the value.
• Rebates: A rebate is a partial refund given after you've purchased your solar panels. These could be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
• Tax Exemptions: Your solar system might qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to exclude the value added by your solar panels when calculating property taxes on your home.

Federal Solar Incentives

When someone says "solar incentives," you likely think of federal incentives first. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a certain percentage of the money you spend on your solar system.

The ITC applies to the value of a solar system installed on your primary or secondary residence in the United States. The solar panels must have been installed on a property you own after January 1, 2006 for you to be eligible for the credit. The ITC originally paid out 30% of all system installation costs (panels, labor, equipment and accessories), although the covered 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.

To better understand how the ITC might apply to you, get in touch with your local Macomb solar panel installer 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 has increased the current credit up to 30% for solar installations undertaken between January 1, 2022 and December 31, 2032. After 2032, the credit percentage will be reduced slightly each year until the end of the program in 2035. Starting in 2023, it will also be easier to get credits for energy storage systems under this new program.

More information about the new Inflation Reduction Act can be found here. The best way to understand how the new Clean Energy Credit applies to you is to get in touch with your local Macomb solar panel installation expert.

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 might be available at a more local level. These incentives may be given out by the Illinois government, or by your county or municipality. Certain incentives are ongoing, while others are available for a limited time.

Next Steps for Installing Solar in Macomb

There are a variety of solar incentives: those given by local utility companies, those given by the federal government and those given by the Illinois government, to name a few. Solar energy use has grown tremendously in the last 15 years, thanks to these incentives. Getting in touch with your local Macomb solar panel installer is the best first step towards getting all the incentives you qualify for when you switch to solar energy.