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

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

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

The phrase "solar incentives" refers to financial incentives designed to encourage increased use of renewable energy by making solar panels more affordable. Incentives may include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered federally, while others are offered by the Illinois government or by your utility company, county or municipality. You might qualify for any of the following types of solar incentives:

• Rebates: A rebate is a partial refund given after you've purchased your solar system. Rebates could be offered by your local utility company, your county or your state. The rebates are usually applied before calculating tax credits.
• Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce more than a predetermined (normally small) amount of electricity can qualify for SRECs or other similar performance-based incentives. SRECs and performance-based incentives in general are typically offered by your state government. When you receive an SREC, you can sell it to your utility company or another buyer, and this is usually considered part of your taxable income.
• Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar system. Property tax exemptions allow you to exclude the added value of your solar system when you're calculating how much property tax you need to pay on your house.
• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the federal government.
• Net Metering: Net metering becomes relevant after your solar system is up and running. If you have a net metering agreement with your Morton Grove utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some locations, this is a dollar-for-dollar credit, while in others you may make back a percentage of the value.

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Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some familiarity with. The Federal Solar Investment Tax Credit, or ITC, is the most commonly known federal solar incentive. The ITC allows you to claim a tax credit for a predetermined percentage of the cost of your solar system.

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

Talking to your local Morton Grove solar panel installation expert is the best way to understand how the ITC applies to your situation.

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. With the new provisions, solar installation projects begun after January 1, 2022, and finished by December 31, 2032, may be eligible for a 30% tax credit. This percentage will then see a slight annual decrease until the end of the current Clean Energy Credit in 2035. Starting in 2023, the expansion to the program will also make claiming credit for energy storage systems easier than ever before.

More information about the new Inflation Reduction Act can be found here. To fully understand how the new Clean Energy Credit might apply to you, speak with your local Morton Grove solar installation company.

State & Local Solar Incentives

Some solar incentives may be offered at the local or state level. As with federal incentives, these could include rebates, tax credits and more. These incentives might be offered by the Illinois government, or by your county or municipality. Some incentives may be available for a limited time, while others are ongoing.

Next Steps for Installing Solar in Morton Grove

Solar incentives may come from your local utility company, the federal government or the Illinois government. The variety of incentives available has helped nationwide use of solar energy increase greatly in the last 15 years. When you're ready to make the switch to solar energy, reaching out to your local Morton Grove solar panel installation expert is a great first step.