2024 Solar Incentives Guide for South Rock Island, IL - Tax Credits & Rebates

What Solar Tax Credits, Incentives, and Rebates are Available in South Rock Island?

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

The phrase "solar incentives" refers to 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. The incentives might include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are provided by the federal government, some by the Illinois government and some by your specific utility company, county or municipality. Some solar incentives you might qualify for are:

• Rebates: A solar rebate is a partial refund after the purchase of your solar system. Rebates may be offered by your local utility company, your county or your state. The cash back that you get from the rebates is normally applied before calculating tax credits.
• Tax Exemptions: Sales tax exemptions are applied at the point of sale for your solar panels. Property tax exemptions allow you to ignore the added value of your solar system when you're calculating the amount of property tax you need to pay on your house.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are generally handled at the state level. Once your solar panel system meets the threshold (usually a small amount of energy production), you are eligible to receive SRECs that you can then sell to your utility company or other buyers. The money you receive is generally considered part of your taxable income.
• Net Metering: Net metering becomes relevant after your solar system is up and running. If you've signed a net metering agreement with your South Rock Island utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this is a dollar-for-dollar credit, while in other areas you might make back a percentage of the value.
• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.

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Federal Solar Incentives

When someone says "solar incentives," you probably think of federal incentives first. One of the incentives many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a given percentage of the cost of your solar system.

The ITC can be applied to solar systems installed after January 1, 2006, and under this program you can deduct from your taxes a percentage of the total cost of solar panels, labor, accessories and equipment. This credit can be claimed on solar panels installed on a primary or secondary residence that you own in the United States. The original amount you could claim was 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum claim amount.

To find out exactly how much money the ITC could save you, contact your local South Rock Island solar panel installer.

The ITC has been renewed and expanded following the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The new Clean Energy Credit extends until 2035. American homeowners can now apply for a 30% credit for solar systems installed between 2022 and 2032. This credit will then decrease annually until its expiration. Starting in 2023, the program expansion will also make credits for energy storage systems even easier to claim.

Click here to learn more about the new Inflation Reduction Act. The easiest way to fully understand how the new Clean Energy Credit applies to you is to speak with your local South Rock Island solar panel installers directly.

State & Local Solar Incentives

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

Next Steps for Installing Solar in South Rock Island

There are many types of solar incentives: those given by the federal government, those provided by the Illinois government and those offered by local utility companies, to name a few. The use of solar energy has increased tremendously in the last 15 years, partially due to these incentives. Reaching out to your local South Rock Island solar panel installer is the right first step towards getting the most money possible when you switch to solar energy.