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

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

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

Solar incentives mitigate the cost of installing solar panels on your home. These financial incentives are intended to encourage more Americans to convert their home partially or fully to renewable energy. The incentives can include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are provided by the federal government, some by the state of Illinois and some by your specific utility company, county or municipality. Types of solar incentives might include:

• Rebates: Solar rebates can be offered by your local utility company, or by your county or state. These rebates work as partial refunds that are applied after your purchase of a solar system and before tax credits are calculated.
• Net Metering: You can sign a net metering agreement with your New Lenox utility company. This agreement may apply to all or a percentage of the excess electricity your solar panels generate. They will then deduct this value from your monthly utility bill.
• Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce over a specific (normally small) amount of electricity qualify for SRECs or similar performance-based incentives. SRECs and similar incentives are typically provided 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 Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
• Tax Exemptions: Tax exemptions can come in two forms. The first is sales tax exemption, applied at the time you purchase your solar panels. The second is property tax exemption. This allows you to ignore the added value of your solar system when calculating property tax for your house.

Federal Solar Incentives

Federal solar incentives are likely to be the first thing that comes to mind when thinking about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC provides you with a tax credit for a predetermined percentage of the cost of your solar system.

The ITC is applied to the total cost of solar system installation, including the panels themselves as well as accessories, labor and equipment. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence that you own, as long as it 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.

Curious how the ITC might apply to your specific situation? Get in touch with your local New Lenox solar panel installer to get more information.

In August 2022, the ITC (now called the Clean Energy Credit) was expanded and extended by the passage of the Inflation Reduction Act. Homeowners are now eligible for a credit equal to 30% of the total costs of solar system installation for projects started after January 1, 2022 and completed before the end of 2032. The credit percentage will then begin to decrease on a yearly basis until the Clean Energy Credit ends in 2035. Starting in 2023, the expansion to the program will also make credits for energy storage systems even easier to claim.

Click here to learn more about the new Inflation Reduction Act. Your local New Lenox solar panel installer can answer your questions and explain how the new Clean Energy Credit may apply to you.

State & Local Solar Incentives

In addition to those provided at the federal level, there are often also state solar incentives. Rebates, tax credits and more may be available at a more local level. These incentives might be given out by the Illinois government, or by your county or municipality. Certain incentives are available for a limited time, while others are ongoing.

Next Steps for Installing Solar in New Lenox

You can apply for solar incentives from the Illinois government and the federal government, as well as from your local utility company. Growing availability of solar initiatives over the last 15 years has helped increase solar adoption nationwide. We suggest talking to your local New Lenox solar installation expert to learn more about these incentives and to ensure that you're getting the largest number possible for your solar panels.