2023 Solar Incentives Guide for Monticello, IL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Monticello.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Monticello?
Special Assessment for Solar Energy Systems
Solar Renewable Energy Credits
Federal Residential Renewable Energy Tax Credit
The phrase "solar incentives" includes 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. Different types of incentives, such as cash back, discounts or monthly utility bill credits, may be available to you. Some incentives may be provided via the state of Illinois, by your utility company or by county or municipality, while others are federal. Some solar incentives you might qualify for are:
- Tax Exemptions: Your solar panel system could 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 that solar panels add when calculating property taxes on your house.
- Net Metering: Be sure to talk with your Monticello utility company about signing a net metering agreement. This will allow you to get a credit towards your utility bill every month for the value of excess energy generated by your solar panels. You may receive either a dollar-for-dollar credit or a percentage of the value.
- 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.
- Rebates: A solar rebate is a partial refund given after you've purchased your solar system. These may 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.
- Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce over a specific (usually small) amount of electricity qualify for SRECs or similar performance-based incentives. SRECs and similar incentives are typically provided at the state level. SRECs can be sold to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some knowledge of. You might have heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit that reduces your taxes by a specified percentage of the money you spend installing solar panels.
The ITC can be credited towards the value of a solar system installed on your primary or secondary residence in the United States. The solar system has to have been installed on a property you own after January 1, 2006 for you to be eligible for the credit. The ITC initially covered 30% of all system installation costs (panels, labor, equipment and accessories), although the covered amount has fluctuated slightly 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.
Have questions about how the ITC applies to your specific situation? Contact your local Monticello solar panel installation expert to get more information.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). Homeowners are now eligible for a credit equal to 30% of the total solar system installation costs for projects that began after January 1, 2022 and will be finished by the end of 2032. The percentage will then begin to 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, beginning in 2023.
Click here to learn more about the new Inflation Reduction Act. The best way to understand how the new Clean Energy Credit applies to you is to reach out to your local Monticello solar panel installers with your questions.
State & Local Solar Incentives
Some solar incentives are often also offered at the local or state level. As with federal incentives, these could include rebates, tax credits and more. These incentives might 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 Monticello
Solar energy use nationwide has gone up significantly in the past 15 years, in part due to the proliferation of solar incentives. You may get these incentives from your local utility company, the Illinois government or the federal government. If you're ready to make the change to solar energy, talking to your local Monticello solar panel installation expert is a great first step.
EcoWatch's Monticello, IL Solar Incentives FAQs
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.