2023 Solar Incentives Guide for Franklin Town, MA - Tax Credits & Rebates

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

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

Solar incentives are designed to mitigate the cost of installing a solar panel system 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 types of incentives, like cash back, discounts or monthly utility bill credits, might be available to you. Certain incentives may be provided via the state of Massachusetts, by your utility company or by county or municipality, while others are federal. Some broad categories of solar incentives include:

• Tax Exemptions: Your solar panels might qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions let you exclude the value added by your solar panels when you are calculating property taxes on your home.
• Rebates: A solar rebate is a partial refund after the purchase of your solar system. These may be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
• Tax Credits: Tax credits decrease, dollar-for-dollar, how much income tax you owe the federal government. These are different from tax deductions.
• Solar Renewable Energy Certificate (SREC): In most cases, solar systems that produce over a specific (generally small) amount of electricity can qualify for SRECs or other similar performance-based incentives. SRECs and similar incentives 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 is an incentive you can get after your solar system is up and running. If you have a net metering agreement in place with your Franklin Town utility company, the company will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some locations, this credit is dollar-for-dollar, while in other places you might make back a percentage of the value.

Federal Solar Incentives

Federal solar incentives are likely the first thing that you think of when you think about solar incentives. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a certain percentage of the money you spend on solar panels for your home.

The ITC can be applied to the total cost of solar panel installation, including the panels themselves as well as labor, equipment and accessories. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence located in the United States that you own. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum claim amount.

Contacting your local Franklin Town solar panel installation expert is the best way to understand how the ITC applies to your situation.

In August 2022, the ITC (now referred to as the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. The Clean Energy Credit re-raises the credit up to 30% for solar installations undertaken between January 1, 2022 and December 31, 2032. After this, the percentage will decrease slightly each year until the program expires in 2035. Starting in 2023, it will also be easier to get credits for energy storage systems under the new laws.

More information about the new Inflation Reduction Act can be found here. To understand how the new Clean Energy Credit will apply to you, talk to your local Franklin Town solar installation company.

State & Local Solar Incentives

Some solar incentives may be provided at the state and local level. Similar to federal incentives, these could include tax credits, rebates and more. Incentives may be handled by your county or municipality, or by the state of Massachusetts. Some incentives may be available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in Franklin Town

Solar energy use nationwide has increased enormously in the past 15 years, in part due to the increase in availability of solar incentives. You can obtain these incentives from your local utility company, the Massachusetts government or the federal government. Speaking with your local Franklin Town solar panel installer is the right first step towards getting all the incentives you qualify for when you switch to solar energy.