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

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

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

Solar incentives are intended to encourage homeowners to make the switch to renewable energy by offering incentives that lower the financial burden of solar panel installation and use. These incentives may include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are handled by the federal government, some by the state of Illinois and some by your specific utility company, county or municipality. Some solar incentives you might qualify for are:

• Net Metering: Net metering becomes relevant after your solar system is up and running. If you have a net metering agreement in place with your River Forest utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some places, this credit is dollar-for-dollar, while in others you may be refunded a percentage of the value.
• Tax Exemptions: These could come in the form of property tax exemptions, which would allow you to exclude the value added by your solar panels when calculating the taxes you pay on your house. You could also look for exemptions on sales tax at the time of purchase.
• Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce more than a predetermined (generally small) amount of electricity will qualify for SRECs or similar performance-based incentives. SRECs and the like are typically provided 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.
• Rebates: A solar rebate is a partial refund after the purchase of your solar system. Rebates could be offered by your local utility company, your state or your county. The rebates are usually applied before tax credits are calculated.
• Tax Credits: Tax credits reduce, dollar-for-dollar, how much income tax you owe the federal government. Tax credits are different from tax deductions.

Federal Solar Incentives

Federal solar incentives are probably the first thing that you think of when thinking about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is probably the most commonly known federal solar incentive. The ITC offers a tax credit for a specific percentage of your solar system's cost.

The ITC covers solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, equipment, accessories and labor. You can receive this credit for solar panels installed on a primary or secondary residence in the United States that you own. The original amount you could claim was 30% of the total cost, although certain projects may qualify for only 26%, depending on the details. There is no maximum claim amount.

Speaking with your local River Forest solar panel installation expert is the best way to learn more about how the ITC applies to you.

In August 2022, the ITC (now called the Clean Energy Credit) was bolstered by the passage 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 2032, the percentage will be reduced slightly each year until the end of the program in 2035. The expansion to the program also makes it easier to get credit for energy storage systems, starting in 2023.

More information about the new Inflation Reduction Act can be found here. Your local River Forest solar panel installation expert is the best person to answer your questions about the new Clean Energy Credit and how it may apply to you.

State & Local Solar Incentives

Federal solar incentives are not your only option; rebates, tax credits and more are often offered at the local or state level. Some incentives are ongoing, while others might only be available for a limited time. Incentives may be offered by your county or municipality, or by the Illinois government.

Next Steps for Installing Solar in River Forest

Nationwide solar energy use has increased enormously in the last 15 years, in part due to the proliferation of solar incentives. You may get these incentives from the Illinois government, the federal government or your local utility company. When you're prepared to switch over to solar energy, calling your local River Forest solar panel installation expert is an excellent place to start.