2024 Solar Incentives Guide for Shorewood, IL - Tax Credits & Rebates

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

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

Solar incentives help mitigate the cost of installing a solar panel system on your home. This category of financial incentives is in place to encourage more Americans to convert their home partially or fully to renewable energy. You may be eligible for different types of incentives, such as discounts, cash back or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of Illinois and others from the federal government. Types of solar incentives might include:

• Rebates: A solar rebate is a partial refund after the purchase of your solar panels. These might be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.
• Net Metering: Be sure to speak to your Shorewood 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 generated by your solar panels. You could receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Exemptions: Tax exemptions can come in one of two forms. The first is sales tax exemption, applied when you purchase 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 home.
• Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (This is different from a tax deduction.)
• Solar Renewable Energy Certificate (SREC): In general, solar systems that produce over a specific (generally small) amount of electricity will qualify for SRECs or similar performance-based incentives. SRECs and the like are typically provided at the state level. SRECs can be sold to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.

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Federal Solar Incentives

Federal incentives are the kind 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 certain percentage of the money you spend on solar panels for your home.

The ITC can be applied to 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. Originally, the ITC covered 30% of all system costs (panels, labor, accessories and equipment), although the amount has fluctuated slightly over time between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the amount you can claim.

To better understand how the ITC might apply to your situation, call your local Shorewood solar panel installation expert and ask for more information.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now dubbed the Clean Energy Credit. Now, solar installation projects that are completed between 2022 and 2032, can qualify for a 30% tax credit. This credit amount will then see a slight annual decrease until the end of the current Clean Energy Credit in 2035. The expansion to the program also makes credits for energy storage systems even easier to claim, beginning in 2023.

More information about the new Inflation Reduction Act can be found here. To fully understand how the new Clean Energy Credit applies to you, talk to your local Shorewood solar installation company.

State & Local Solar Incentives

Some solar incentives may be provided by state and local governments. As with federal incentives, these could include tax credits, rebates and more. Some incentives are ongoing, while others may only be available for a limited time. Incentives might be given by the Illinois government, or by your county or municipality.

Next Steps for Installing Solar in Shorewood

Solar incentives might be offered by the Illinois government, the federal government or your local utility company. The growing number of available incentives has contributed to a large increase in solar energy use in the last 15 years. Your local Shorewood solar panel installation expert can give you more information about which incentives you may qualify for, and get you started on the path to switching to renewable energy today.