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

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

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

Solar incentives are meant to help mitigate the cost of installing solar panels on your home. This category of financial incentives is designed to encourage more people to convert their home partially or fully to renewable energy. Different kinds of incentives, like cash back, discounts or credit towards your monthly utility bill, may be available to you. Certain incentives may be offered by the Illinois government, by your utility company or by county or municipality, while others are federal. Types of solar incentives might include:

• Net Metering: Be sure to speak to your Swansea utility company about signing a net metering agreement. This will allow you to receive 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.
• Tax Exemptions: Tax exemptions can come in two forms. The first is sales tax exemption, which is applied at the time you purchase your solar panels. The second is property tax exemption. This allows you to exclude the value added by your solar system when paying property tax on your home.
• Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce more than a predetermined (normally small) amount of electricity can qualify for SRECs or similar performance-based incentives. SRECs and similar incentives are typically provided by your state government. You can sell SRECs to your utility company or another buyer, and generally the money you make is normally considered part of your taxable income.
• Rebates: Solar rebates can be offered by your county or state, or by your local utility company. These rebates work as partial refunds that are applied after you pay for solar panels and before tax credits are calculated.
• Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.

Federal Solar Incentives

Federal solar incentives are probably the first thing that comes to mind when thinking about solar incentives. An incentive that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a specific percentage of your solar system's cost.

The ITC applies towards 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, equipment, accessories and labor. You can receive this credit for 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 depending on when the project was completed, your credit may range from 26-30%. There is no maximum amount you can claim.

Your local Swansea solar panel installation expert can give you more information about the ITC and how it applies to your situation.

The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as retitling it the Clean Energy Credit). The new Clean Energy Credit now runs until 2035. You can now apply for a 30% credit for solar systems that began installation on or after January 1, 2022 and will be done by December 31, 2032. The total credit will then see a slight annual decrease until its expiration. The expansion also makes claiming credit for energy storage systems easier than ever before, starting in 2023.

More information about the new Inflation Reduction Act can be found here. The easiest way to fully understand how the new Clean Energy Credit will apply to you is to reach out to your local Swansea solar panel company with your questions.

State & Local Solar Incentives

Tax credits, rebates and more might be claimed at multiple levels. On top of federal solar incentives, there are often state and local ones as well. The incentives — which may be provided by the state of Illinois, or by your county or municipality — may be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Swansea

You can qualify 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 in the past 15 years has helped greatly increase nationwide adoption of solar energy. Call your local solar panel installation expert today to find out more information and to save the most money possible on solar panels for your Swansea home.