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

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

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

Solar incentives encourage homeowners to switch their home over to renewable energy by providing incentives meant to lower the financial burden of solar panel installation and use. You might be eligible for different kinds of incentives, such as cash back, discounts or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of Illinois and others from the federal government. You might qualify for any of the following types of solar incentives:

• Tax Exemptions: Tax exemptions can come in two forms. First, there is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption. This allows you to ignore the value added by your solar system when paying property tax on your home.
• Rebates: Some solar companies will help you claim a rebate, or partial refund after purchase, for your solar panels. States or counties will also sometimes offer limited-time rebates. The value of a rebate will usually come off your total price before any tax credits are calculated.
• Net Metering: Net metering factors in after your solar system is up and running. If you've signed a net metering agreement with your Park Forest utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some places, this is a dollar-for-dollar credit, while in other areas you may make back a percentage of the value.
• Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce over a threshold (generally small) amount of electricity qualify for SRECs or similar performance-based incentives. SRECs and performance-based incentives in general are typically given by your state government. You can sell SRECs 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 that lower the amount of income tax you owe the federal government. (A tax credit is different from a tax deduction.)

Federal Solar Incentives

When thinking about solar incentives, federal incentives are likely the first thing that comes to mind. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit equal to a predetermined percentage of the money you spend on your solar system.

The ITC applies to the value of a solar system installed on your primary or secondary residence in the United States. The solar panels have to have been installed on a property you own after January 1, 2006 for you to claim the credit. The ITC initially covered 30% of all installation costs (panels, labor, equipment and accessories), although the total amount has fluctuated 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 claim amount.

To better understand how the ITC might apply to you, speak to your local Park Forest solar panel installer and request more information.

The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit re-raises the credit up to 30% for solar systems installed between 2022 and 2032. At this point, the credit percentage will be reduced slightly each year until the end of the program in 2035. Starting in 2023, it will also be easier to obtain credits for energy storage systems under this new program.

Click here to learn more about the new Inflation Reduction Act. To better understand how the new Clean Energy Credit applies to you, reach out to your local Park Forest solar installation company.

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 can be offered at a more local level. Certain incentives are ongoing, while others are offered for only a limited time. Your local incentives may come from the Illinois government, or from your specific county or municipality.

Next Steps for Installing Solar in Park Forest

You can apply for solar incentives from the Illinois government and the federal government, as well as from your local utility company. This increase in availability of solar initiatives over the last 15 years has helped greatly increase nationwide adoption of solar energy. Getting in touch with your local Park Forest solar panel installation expert is the right first step towards getting all the incentives you qualify for when you switch to solar energy.