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

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

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

The phrase "solar incentives" includes a 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. These incentives could include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are handled by the federal government, some by the Illinois government and some by your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:

• Tax Exemptions: Your solar panel system might qualify for both sales tax and property tax exemptions. Sales tax exemptions are effective at the time of purchase. Property tax exemptions let you exclude the added value of the solar panels when calculating property taxes on your house.
• Rebates: A rebate is a partial refund given after you've purchased your solar panels. These may be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
• 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 are eligible to receive SRECs that can then be sold to your utility company or other buyers. The money you receive is generally considered part of your taxable income.
• Net Metering: Net metering factors in after your solar system is up and running. If you have a net metering agreement in place with your Milton utility company, the company 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 others you may receive a refund equivalent to a percentage of the value.
• Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.

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Federal Solar Incentives

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

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

To know exactly how much money the ITC could save you, contact your local Milton solar panel installer.

The ITC has been renewed and expanded following the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The Clean Energy Credit lasts until 2035. Any solar installation project that is completed between January 1, 2022, and December 31, 2032, may qualify for a 30% tax credit; this amount will be decreased slightly on a yearly basis until the current program ends. Beginning in 2023, it will also be easier to claim credits for energy storage systems under this new program.

More information about the new Inflation Reduction Act can be found here. To fully understand how the new Clean Energy Credit will apply to you, reach out to your local Milton solar installation company.

State & Local Solar Incentives

Some solar incentives are often also provided at the state and local level. Similar to federal incentives, these can include rebates, tax credits and more. Certain incentives are offered for only a limited time, while others are ongoing. Local solar incentives could come from your county or municipality, or from the Illinois government.

Next Steps for Installing Solar in Milton

The nationwide use of solar energy has increased enormously in the past 15 years, in part due to the growth in the number of solar incentives. You might receive these incentives from your local utility company, the Illinois government or the federal government. We suggest talking to your local Milton solar installation expert for more information about these incentives and to ensure that you're getting the largest number possible for your solar panels.