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

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

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

The term "solar incentives" includes a wide range of financial incentives implemented to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. You might be eligible for different kinds of incentives, including cash back, discounts or monthly utility bill credits, 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. Some solar incentives you might qualify for are:

• Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
• 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. Typically, a certain (small) threshold of energy production must be met before your solar system qualifies for SRECs or other performance-based incentives. These kinds of incentives are normally handled at the state level.
• Net Metering: Be sure to talk to your Rockton utility company about signing a net metering agreement. This will allow you to get a credit towards your utility bill every month for the value of excess energy your solar panels generate. You may receive either a dollar-for-dollar credit or a percentage of the value.
• Rebates: A solar rebate is a partial refund after the purchase of your solar system. These may be offered by your local utility company, your state or your county. The rebates are usually applied before tax credits are calculated.
• Tax Exemptions: Tax exemptions can come in two forms. First, there 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 value added by your solar system when paying property tax on your house.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some knowledge of. You may have heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit equal to a specified percentage of the money you spend on your solar system.

The ITC originally covered 30% of the total cost of installing solar panels, although it has fluctuated slightly over time between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total installation cost includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum amount you can claim. The ITC can be applied 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.

To more fully understand how the ITC may apply to your situation, call your local Rockton solar panel installer and ask for more information.

The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). Homeowners are now eligible for a credit of 30% of the total solar system installation costs for projects that began after January 1, 2022 and will be finished by the end of 2032. The percentage will then decrease on a yearly basis until the Clean Energy Credit ends in 2035. Beginning in 2023, it will also be easier to obtain credits for energy storage systems under the new laws.

More information about the new Inflation Reduction Act can be found here. Your local Rockton solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it may apply to you.

State & Local Solar Incentives

There are often state solar incentives available in addition to federal ones. Tax credits, rebates and more may be available at a more local level. Certain incentives are ongoing, while others are only available for a limited time. These incentives might be provided by the Illinois government, or by your county or municipality.

Next Steps for Installing Solar in Rockton

There are a variety of solar incentives: those given by local utility companies, those given by the Illinois government and those given by the federal government, to name a few. The use of solar energy has increased tremendously in the last 15 years, partially thanks to these incentives. Reach out to your local solar panel installer today to find out more information and to save as much money as possible on a solar system for your Rockton home.