2023 Solar Incentives Guide for Elwood, IN - Tax Credits & Rebates

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

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

Solar incentives are intended to encourage homeowners to make the switch to renewable energy by offering incentives that lower the financial burden of solar panel installation and use. Solar incentives may include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are given by the federal government, some by the state of Indiana and some by your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:

• 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.)
• Net Metering: You may be able to sign a net metering agreement with your Elwood utility company that will apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then deduct this value from your monthly utility bill.
• Tax Exemptions: Tax exemptions can come in one of 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 home.
• Rebates: Rebates, or cash back after a purchase, are typically applied before any solar tax credits are calculated. Solar rebates can be given by your local utility company, by your state or by your county.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have heard of. One of the incentives that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a given percentage of the cost of your solar system.

The ITC was originally for 30% of the total cost of solar system installation, although that number has fluctuated slightly over the last few years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total cost of installation includes the panels themselves as well as the cost of equipment, labor and accessories. There is no maximum amount you can claim. The ITC applies to solar panels installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.

Talking to your local Elwood solar panel installer is the best way to learn more about how the ITC could apply to you.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now referred to as the Clean Energy Credit. Homeowners are now eligible for a credit equal to 30% of the total costs of solar system installation for projects that began after January 1, 2022 and will be finished by the end of 2032. The credit percentage will then begin to decrease on a yearly basis until the Clean Energy Credit expires in 2035. The expansion to the program also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.

More information about the new Inflation Reduction Act can be found here. To better understand how the new Clean Energy Credit applies to you, talk to your local Elwood solar installers.

State & Local Solar Incentives

In addition to those provided at the federal level, there are often also state solar incentives. Tax credits, rebates and more may be available at a more local level. Incentives might be provided by your county or municipality, or by the state of Indiana. Certain incentives may be available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in Elwood

Nationwide solar energy use has gone up tremendously in the last 15 years, in part thanks to the proliferation of solar incentives. You may get these incentives from your local utility company, the Indiana government or the federal government. Reaching out to your local Elwood solar panel installation company is the right first step towards making sure you get all the incentives you qualify for when you switch to solar energy.