2025 Solar Incentives Guide for Harper Woods, MI - Tax Credits & Rebates

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

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

The phrase "solar incentives" broadly refers to financial incentives put in place by solar companies and the government to encourage people to use renewable energy by making installing and using solar panels more affordable. Different kinds of incentives, including discounts, cash back or monthly utility bill credits, might be available to you. Some incentives may be handled by the state of Michigan, by your utility company or by county or municipality, while others are federal. Some broad categories of solar incentives include:

• Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the government.
• Rebates: A solar rebate is a partial refund given after you've purchased your solar panels. Rebates could be offered by your local utility company, your county or your state. The cash back that you get from the rebates is normally applied before tax credits are calculated.
• Tax Exemptions: These could come in the form of property tax exemptions, which would allow you to ignore the value added by your solar panels when paying property tax on your house. You could also look for exemptions on sales tax at the time of purchase.
• Net Metering: Make sure you talk to your Harper Woods utility company about signing a net metering contract. This allows you to receive credit towards your utility bill every month 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 think about solar incentives, you probably think of federal incentives first. You might have 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 installing solar panels.

The ITC applies to the value of solar panels installed on your primary or secondary residence in the United States. The solar panels must have been installed on a property you own after January 1, 2006, for you to claim the credit. The ITC initially covered 30% of all installation costs (panels, equipment, accessories and labor), although this amount has fluctuated 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.

Your local Harper Woods solar panel installation expert can give you more information about the ITC and how it might apply to your situation.

The ITC has been renewed and expanded following the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. For solar system installations that begin after January 1, 2022, and are completed by the end of 2032, homeowners may be eligible for a credit for 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit expires in 2035. The program expansion also makes credits for energy storage systems even easier to claim, starting in 2023.

Click here to learn more about the new Inflation Reduction Act. The best way to understand how the new Clean Energy Credit applies to you is to talk with your local Harper Woods solar panel installers.

State & Local Solar Incentives

Some solar incentives are often also provided by state and local governments. Similar to federal incentives, these can include rebates, tax credits and more. Incentives may be given by the state of Michigan, or by your county or municipality. Some incentives may be available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in Harper Woods

The nationwide use of solar energy has significantly increased 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 federal government or the Michigan government. If you're ready to make the switch to solar energy, talking to your local Harper Woods solar panel installation expert is an excellent place to start.