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

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

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

The term "solar incentives" refers broadly to financial incentives put in place by solar companies and the government to encourage the use of renewable energy by making installing and using solar panels more affordable. You might qualify for various kinds of incentives, including discounts, cash back or credit towards your monthly utility bill, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the Illinois government and others from the federal government. Some broad categories of solar incentives include:

• Net Metering: Don't forget to talk with your Manhattan utility company about signing a net metering agreement. This allows you to get a credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You could receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Credits: Tax credits reduce, dollar-for-dollar, the total amount of tax you owe the federal government. These differ from tax deductions.
• Tax Exemptions: Your solar panels may qualify for exemptions on both sales and property tax. Sales tax exemptions are applied at the time of purchase. Property tax exemptions allow you to exclude the value added by your solar panels when you are calculating property taxes on your home.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives might be available to you if the solar system on your home produces more than a specified (usually small) amount of electricity. These types of incentives are usually handled by the state government. You can sell your SRECs to your utility company or other buyers, and the money you make is typically considered part of your taxable income.
• Rebates: A solar rebate is a partial refund given after you've purchased your solar system. 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 calculating tax credits.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have heard of. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a specified percentage of the cost of your solar system.

The ITC applies to the total cost of installing a solar system, including the panels themselves as well as labor, equipment and accessories. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence that you own and that is located in the United States. The tax credit ranges from 26-30% of total costs depending on when your project was completed. There is no maximum claim amount.

Wondering how the ITC applies to your specific situation? Reach out to your local Manhattan solar panel installation expert to get 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. For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners can receive a credit equal to 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit ends in 2035. The expansion to the program also makes it easier to get credit for energy storage systems, starting in 2023.

More information about the new Inflation Reduction Act can be found here. To understand how the new Clean Energy Credit will apply to you, get in touch with your local Manhattan solar installers.

State & Local Solar Incentives

Tax credits, rebates and more might be provided at multiple levels. Along with federal solar incentives, there are often state and local ones, too. These incentives — which may be given by your county or municipality, or by the state of Illinois — might be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Manhattan

Solar incentives may be provided by the federal government, the Illinois government or your local utility company. The large number of available solar incentives has facilitated the nationwide growth of solar energy use in the last 15 years. Talking to your local Manhattan solar panel installation expert is the right first step towards getting the most money possible when you switch to solar energy.