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

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

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

The term "solar incentives" refers to financial incentives put in place by solar companies and the government to encourage the adoption and use renewable energy by making the installation and use of solar panels more affordable. Various types of incentives, such as discounts, cash back or monthly utility bill credits, might be available to you. Certain incentives may be handled by the state of Illinois, by your utility company or by county or municipality, while others are federal. Some solar incentives you might qualify for are:

• Solar Renewable Energy Certificate (SREC): In most cases, solar systems that produce more than a specified (usually small) amount of electricity qualify for SRECs or similar performance-based incentives. SRECs and performance-based incentives in general are typically given at the state level. When you receive an SREC, you can sell it to your utility company or another buyer, and this is usually considered part of your taxable income.
• Net Metering: Net metering factors in once your solar system is up and running. If you've signed a net metering agreement with your Wayne utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in other areas you may make back a percentage of the value.
• Rebates: Some solar companies will help you claim a rebate, or partial refund after purchase, for your solar panels. States or counties will also offer limited-time rebates at various times. The value of a rebate will usually come off your total price before tax credits are calculated.
• Tax Credits: Tax credits reduce, dollar-for-dollar, the amount of income tax you owe the federal government. Tax credits differ from tax deductions.
• 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 exclude the value added by your solar system when calculating property tax for your house.

Federal Solar Incentives

Federal solar incentives are likely the first thing that comes to mind when you think about solar incentives. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a specified percentage of your solar system's cost.

The ITC applies to the total cost of installing solar panels, including the panels themselves as well as equipment, accessories and labor. You can claim this credit for panels installed after January 1, 2006 on a primary or secondary residence that you own and that is located in the United States. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum claim amount.

To more fully understand how the ITC could apply to you, call your local Wayne solar panel installation expert and request more information.

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 Clean Energy Credit lasts until 2035. Solar installation projects started after January 1, 2022 and completed by the end of 2032 may qualify for a 30% tax credit; the amount will be decreased slightly on a yearly basis until the current program ends. Beginning in 2023, it will also be easier to claim credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. Your local Wayne solar panel installer can answer any questions you have and explain how the new Clean Energy Credit applies to you.

State & Local Solar Incentives

There are often also state solar incentives in addition to those provided by the federal government. Rebates, tax credits and more may be available at a more local level. Some incentives are ongoing, while others may only be available for a limited time. Incentives may be given by the Illinois government, or by your county or municipality.

Next Steps for Installing Solar in Wayne

The nationwide use of solar energy has significantly increased in the past 15 years, in part thanks to the proliferation of solar incentives. You may get these incentives from your local utility company, the federal government or the Illinois government. When you're ready to switch over to solar energy, calling your local Wayne solar panel installation expert is a great first step.