2023 Solar Incentives Guide for Independence, MI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Independence.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Independence?
Michigan Saves - Home Energy Loan Program
Federal Residential Renewable Energy Tax Credit
Solar incentives are designed to make renewable energy usage more affordable through financial incentives for individuals who install solar panels on their homes. You might be eligible for various kinds of incentives, such as cash back, discounts or monthly utility bill credits, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the Michigan government and others from the federal government. Types of solar incentives might include:
- Rebates: Solar companies may help you claim a rebate, or partial refund after purchase, for your solar panels. States or counties will also offer limited-time rebates at various times. Any rebates you receive will usually come off your total price before any tax credits are calculated.
- Tax Exemptions: These may come in the form of property tax exemptions, which let you exclude the value added by your solar panels when calculating the taxes you pay on your house. They may also include exemptions on sales tax at the time of purchase.
- Net Metering: Net metering becomes relevant after your solar system is up and running. If you've signed a net metering agreement with your Independence utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this is a dollar-for-dollar credit, while in other places you may get refunded a percentage of the value.
- Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
Federal Solar Incentives
When you think about solar incentives, you likely think of federal incentives first. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a certain percentage of the cost of your solar system.
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, accessories, equipment and labor. This credit can apply towards a solar panel system installed on a primary or secondary residence that you own in the United States. The original amount you could claim was 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum amount you can claim.
Reaching out to your local Independence solar panel installation expert is the best way to understand how the ITC may apply to you.
The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. Now, solar installation projects begun after January 1, 2022 and finished by December 31, 2032 can qualify for a 30% tax credit. This percentage will then decrease slightly each year until the current Clean Energy Credit expires in 2035. The expansion to the program also makes it easier to get credit for energy storage systems, starting in 2023.
Click here to learn more about the new Inflation Reduction Act. Your local Independence solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it may apply to you.
State & Local Solar Incentives
Some solar incentives may be offered at the local or state level. Like with federal incentives, these can include tax credits, rebates and more. These incentives may be distributed by the Michigan government, or by your county or municipality. Certain incentives are ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Independence
The large number of solar incentives available has enormously increased the adoption of solar energy nationwide over the last 15 years. You may receive solar incentives from the federal government, the Michigan government or from your local utility company. Speaking with your local Independence solar panel installation expert is the best first step towards making sure you get all the incentives you qualify for when you switch to solar energy.
EcoWatch's Independence, MI Solar Incentives FAQs
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.