2023 Solar Incentives Guide for Waterloo, IL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Waterloo.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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What Solar Tax Credits, Incentives, and Rebates are Available in Waterloo?
Special Assessment for Solar Energy Systems
Solar Renewable Energy Credits
Federal Residential Renewable Energy Tax Credit
Solar incentives are designed to encourage homeowners to make the switch to renewable energy by providing financial incentives that lower the burden of solar panel installation and use. Solar incentives could 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 broad categories of solar incentives include:
- Tax Exemptions: Tax exemptions may come in two forms. First, there 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 ignore the value added by your solar system when paying property tax on your house.
- Solar Renewable Energy Certificate (SREC): SRECs can be sold to your utility company (or other buyers) for cash that typically becomes part of your taxable income. Typically, there is a small threshold of energy production to meet before your solar system can earn SRECs or other performance-based incentives. These kinds of incentives are typically handled at the state level.
- Rebates: Your solar installer might help you claim a rebate, or partial refund of your purchase, for your solar panels. Counties or states will also sometimes offer limited-time rebates. If you receive a rebate, that amount will usually be deducted from your total price before tax credits are calculated.
- Net Metering: Net metering factors in after your solar system is up and running. If you have a net metering agreement with your Waterloo utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some places, this credit is dollar-for-dollar, while in other places you may be refunded a percentage of the value.
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
Federal Solar Incentives
When thinking about solar incentives, you probably think of federal incentives first. 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 predetermined percentage of the cost of your solar system.
The ITC can be applied to solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, equipment, accessories and labor. This credit can be claimed on solar panels installed on a primary or secondary residence in the United States that you own. The original claim amount 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.
Speaking with your local Waterloo solar panel installation expert is the best way to learn more about how the ITC applies to you.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now titled the Clean Energy Credit. The new Clean Energy Credit is valid until 2035. American homeowners are now eligible for a 30% credit for solar systems that began installation after January 1, 2022 and are completed by the end of 2032. The credit will then decrease annually until it expires. The expansion also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.
Click here to learn more about the new Inflation Reduction Act. Your local Waterloo solar panel installation expert is the best person to answer your questions regarding the new Clean Energy Credit and how it applies to you.
State & Local Solar Incentives
Rebates, tax credits and more might be claimed at multiple levels. On top of federal solar incentives, there are often state and local ones as well. These incentives — which may be provided by the state of Illinois, or by your county or municipality — may be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Waterloo
You can apply for and receive solar incentives from the federal government and the Illinois government, as well as from your local utility company. The increased availability of solar initiatives in the past 15 years has helped greatly increase nationwide adoption of solar energy. We suggest talking to your local Waterloo solar installation company to learn more about these incentives and to make sure that you're getting the largest number possible for your solar system.
EcoWatch's Waterloo, IL Solar Incentives FAQs
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.