2023 Solar Incentives Guide for Allen Park, MI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Allen Park.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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Updated March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Allen Park?
Michigan Saves - Home Energy Loan Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives mitigate the cost of installing solar panels on your home. This category of financial incentives is intended to encourage more Americans to switch to renewable energy. Incentives might include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered federally, while others are provided by the state of Michigan or by your utility company, county or municipality. 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 ignore the value added by your solar panels when calculating property taxes on your home.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.
- Rebates: Solar rebates may be provided by your county or state, or by your local utility company. These rebates work as cash back that is applied after your purchase of a solar system and before tax credits are calculated.
- Net Metering: Be sure to talk to your Allen Park utility company about signing a net metering agreement. This allows you to get a credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You might receive either a dollar-for-dollar credit or a percentage of the value.
Federal Solar Incentives
When you hear the term "solar incentives," federal incentives may be the first thing that comes to mind. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit equal to a certain percentage of the money you spend on your solar system.
The ITC can be applied to the total cost of installing solar panels, 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 that you own, as long as it is located in the United States. The tax credit ranges from 26-30% of total costs depending on when your project was completed. There is no maximum claim amount.
Your local Allen Park solar panel installer can offer more information about the ITC and how it applies to your situation.
The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. With the new provisions, solar installation projects that are completed between 2022 and 2032 might qualify for a 30% tax credit. The amount of the credit will then see a slight annual decrease until the end of the current Clean Energy Credit in 2035. Starting in 2023, the expansion will also make credits for energy storage systems even easier to claim.
More information about the new Inflation Reduction Act can be found here. The best way to fully understand how the new Clean Energy Credit applies to you is to speak with your local Allen Park solar panel installation expert directly.
State & Local Solar Incentives
In addition to those provided at the federal level, there are often also state solar incentives. Rebates, tax credits and more may be available at a more local level. These incentives might be distributed by your county or municipality, or by the Michigan government. Some are ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Allen Park
You can apply for solar incentives from the Michigan government and the federal government, as well as from your local utility company. Growing availability of solar initiatives over the last 15 years has helped increase nationwide solar energy use enormously. It is a good idea to talk to your local Allen Park solar installation company for more information about these incentives and to be sure that you're getting all of the money you can for your solar system.
Solar Veteran
Michigan Solar Solutions
- Great warranty coverage
- Outstanding customer service
- Offers products from leading manufacturers
- Slightly limited service offerings
- No leases or PPAs
Outstanding Local Installer
Strawberry Solar
- Outstanding customer service
- Representatives are experts on local policies
- Educational, no-pressure sales approach
- Limited warranty coverage
- No leases or PPAs
- Limited brands of solar equipment available
EcoWatch's Allen Park, MI Solar Incentives FAQs
How do I know if I qualify for specific solar incentives?
It's best to speak with your local Allen Park solar installer to get an understanding of which incentives your project may qualify for. Generally, solar incentives apply to new solar panel systems installed on property you own (in the U.S.) between the dates specified by the incentive. Some incentives, such as those provided by the Michigan government, may have additional requirements.
How much will a solar system save me annually on my electric bill in Allen Park?
Once you add solar panels to your Allen Park home, you can expect to save around $821.56 per year, or around $15,609.63 over 20 years.
When does the federal solar tax credit end?
The Clean Energy Credit (previously called the federal solar tax credit, or the ITC), currently ends on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
If I change out my appliances for ones that can utilize solar energy, are there any credits that I can claim?
The new Inflation Reduction Act introduces a number of incentives that reward homeowners for making eco-friendly upgrades. Some incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.
Can I apply for incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order in which incentives are applied may vary depending on which incentives you are claiming but typically yes, you can claim multiple types of incentives for your solar project. Talk with your solar installer or a local tax professional to verify you are claiming all possible incentives and applying them in the correct order.
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.