2024 Solar Incentives Guide for Louisville, KY - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Louisville.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 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 Louisville?
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are meant to encourage people to switch their home over to renewable energy by offering incentives meant to lower the financial burden of solar panel installation and use. Various kinds of incentives, like cash back, discounts or credit towards your monthly utility bill, may be available to you. Some incentives may be provided via the state of Kentucky, by your utility company or by county or municipality, while other incentives are federal. Some broad categories of solar incentives include:
- Tax Exemptions: Your solar panel system might qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to exclude the added value of the solar panels when calculating property taxes on your home.
- Tax Credits: Tax credits reduce, dollar-for-dollar, the amount of income tax you owe the federal government. Tax credits differ from tax deductions.
- Net Metering: Net metering factors in once your solar panels are up and running. If you've signed a net metering agreement with your Louisville utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in others you might make back a percentage of the value.
- Rebates: Rebates, or cash back after a purchase, are typically applied prior to any solar tax credits being calculated. Solar rebates might be given by your local utility company, by your state or by your county.
Best National Provider
SunPower
- Most efficient panels on the market
- National coverage
- Cradle to Cradle sustainability certification
- Great warranty coverage
- Expensive
- Customer service varies by local dealer
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
Federal Solar Incentives
When you hear the term "solar incentives," federal incentives are likely the first thing that comes to mind. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a predetermined percentage of your solar system's cost.
The ITC can be applied to solar panels installed on your primary or secondary residence in the United States. The solar system must have been installed after January 1, 2006, on a property owned by you for you to claim the credit. The ITC initially covered 30% of all costs (panels, accessories, equipment and labor), although this amount has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the amount you can claim.
To find out exactly how much money the ITC could save you, talk to your local Louisville solar panel installer.
In August 2022, the ITC (now referred to as the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. The new Clean Energy Credit is valid until 2035. You are now eligible for a 30% credit for solar systems installed between 2022 and 2032. This new credit will then be decreased by a few percentage points every year until its expiration. Starting in 2023, the program expansion will also make claiming credit for energy storage systems easier than ever before.
More information about the new Inflation Reduction Act can be found here. Your local Louisville solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it will apply to you.
State & Local Solar Incentives
Federal solar incentives are not your only option; tax credits, rebates and more may be offered at the local or state level. Certain incentives are ongoing, while others are offered for only a limited time. Local solar incentives may come from the Kentucky government, or from your specific county or municipality.
Next Steps for Installing Solar in Louisville
You can apply for and receive solar incentives from the Kentucky government and the federal government, as well as from your local utility company. The growing availability of solar initiatives over the last 15 years has helped increase nationwide solar energy use enormously. If you're ready to switch over to solar energy, talking to your local Louisville solar panel installation expert is a great first step.
EcoWatch's Louisville, KY Solar Incentives FAQs
How can I find out if I qualify for specific solar incentives?
Generally, solar incentives apply to:
- a new solar system
- installed on property that you own
- within the U.S.
- within the date range specified by a particular incentive.
Specific incentives, including those given out by the Kentucky government or by your county/municipality, could have additional qualifications. Speak with your local Louisville solar installer to discover what incentives your project may qualify for.
When does the federal solar tax credit end?
The federal solar tax credit, previously called the ITC and now called the Clean Energy Credit, is slated to end January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
Can I apply for incentives both towards the initial cost of solar panels, and later as reimbursement?
The order that incentives will be applied in could vary depending on which incentives you are eligible for but generally yes, you can receive multiple types of incentives for your solar project. Get in touch with your solar installer or a local tax professional to be sure you are claiming all possible incentives and applying them in the correct order.
What if I add a solar system to a vacation home, rental property or commercial property? Do I still qualify for incentives?
Many solar incentives are intended to apply to a property located within the United States that you own; most secondary residences fall under this distinction. Other solar incentives may be available for commercial properties, depending on the specifics. We recommend reaching out to your local solar installer and/or tax professional to fully understand what incentives will apply to your specific situation.
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.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.