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

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

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

The phrase "solar incentives" refers broadly to financial incentives that are in place to encourage the adoption and use renewable energy by making solar panels more affordable. Incentives may include things like discounts, cash back or monthly utility bill credits. Some incentives are offered federally, while others are offered by the Illinois government or your specific utility company, county or municipality. Types of solar incentives might include:

• Rebates: Your solar installer might help you claim a rebate, or partial refund after purchase, for your solar system. Counties or states will also offer limited-time rebates at various times. Any rebates you receive will usually be deducted from the total price before any tax credits are calculated.
• Tax Exemptions: Sales tax exemptions are effective at the time of purchase for your solar panels. Property tax exemptions let you exclude the value that your solar panels add when you're calculating the amount of property tax you need to pay on your home.
• Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that typically becomes part of your taxable income. In most cases, there is a small threshold of energy production to meet before your solar system qualifies for SRECs or similar performance-based incentives. SRECs and similar incentives are typically handled by your state government.
• Net Metering: Make sure you talk with your Norridge utility company about signing a net metering agreement. This allows you to receive credit towards your monthly utility bill for the value of excess energy your solar panels generate. You might receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the federal government.

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 familiar with is probably the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a certain percentage of the cost of your solar system.

The ITC is applied to the total cost of solar panel 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 and that is located in the United States. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum claim amount.

Curious how the ITC might apply to your specific situation? Contact your local Norridge solar panel installation expert to get more information.

In August 2022, the ITC (now called the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. The Clean Energy Credit has increased the current credit up to 30% for solar systems installed between 2022 and 2032. After this, the credit percentage will decrease slightly each year until the program expires in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. Your local Norridge solar panel installation experts can answer any questions you have and explain how the new Clean Energy Credit will apply to you.

State & Local Solar Incentives

Tax credits, rebates and more might be claimed at multiple levels. Along with federal solar incentives, there are often state and local ones as well. Incentives might be handled by the state of Illinois, or by your county or municipality. Some incentives are available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in Norridge

Solar energy use nationwide has gone up tremendously in the past 15 years, in part due to the proliferation of solar incentives. You might receive these incentives from your local utility company, the federal government or the Illinois government. It is a good idea to talk to your local Norridge solar installation company for more information about these incentives and to make sure that you're getting the most money possible for your solar panels.