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

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

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

The term "solar incentives" refers to financial incentives put in place by solar companies and the government to encourage people to use renewable energy by making solar panels more affordable. These incentives might include upfront discounts, cash back or monthly credits towards your utility bill. Some incentives are offered by the federal government, some by the state of Massachusetts and some by your utility company, county or municipality. Some solar incentives you might qualify for are:

• Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that normally counts as part of your taxable income. In most cases, a certain (small) threshold of energy production must be met before your solar system qualifies for SRECs or similar performance-based incentives. Incentives like these are typically handled at the state level.
• Tax Exemptions: Your solar panel system may qualify for exemptions on both sales and property tax. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions allow you to exclude the value that solar panels add when you are calculating property taxes on your house.
• Rebates: Solar companies may help you claim a rebate, or partial refund of your purchase, for your solar system. Counties or states will also offer limited-time rebates at various times. Any rebates you receive will usually be deducted from the total price before tax credits are calculated.
• Tax Credits: Tax credits decrease, dollar-for-dollar, how much income tax you owe the federal government. Tax credits are different from tax deductions.
• Net Metering: Net metering factors in once your solar panels are up and running. If you have a net metering agreement with your Scituate 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 is a dollar-for-dollar credit, while in other areas you might be refunded a percentage of the value.

Federal Solar Incentives

When thinking about solar incentives, federal incentives might be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is probably the most well-known federal solar incentive. The ITC provides a tax credit for a specific percentage of your solar system's cost.

The ITC applies towards 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, labor and accessories. You can claim this credit for solar panels installed on a primary or secondary residence in the United States that you own. The original amount you could claim 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.

To better understand how the ITC could apply to you, reach out to your local Scituate solar panel installer and request more information.

In August 2022, the Inflation Reduction Act expanded and extended the ITC, now dubbed the Clean Energy Credit. The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar systems installed between 2022 and 2032. After 2032, the percentage will see a slight decrease annually until the end of the program in 2035. The expansion to the program also makes it easier to get credit for energy storage systems, beginning in 2023.

Click here to learn more about the new Inflation Reduction Act. Your local Scituate solar panel installation expert is the best person to answer your questions about the new Clean Energy Credit and how it applies to you.

State & Local Solar Incentives

There are often state solar incentives available in addition to federal ones. Tax credits, rebates and more might be available at a more local level. These incentives — which might be handled by your county or municipality, or by the state of Massachusetts — might be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Scituate

There are a variety of solar incentives: those provided by local utility companies, those provided by the Massachusetts government and those provided by the federal government, to name a few. The use of solar energy has increased enormously in the last 15 years, partially due to these incentives. We suggest talking to your local Scituate solar installer to learn more about these incentives and to ensure that you're getting all of the money you can for your solar panels.