2023 Solar Incentives Guide for Lincoln, MI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Lincoln.
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 Lincoln?
Michigan Saves - Home Energy Loan Program
Federal Residential Renewable Energy Tax Credit
The phrase "solar incentives" refers broadly to financial incentives put in place by solar companies and the government to encourage increased use of renewable energy by making the installation and use of solar panels more affordable. The incentives may include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are handled by the federal government, some by the Michigan government and some by your utility company, county or municipality. Categories of solar incentives include:
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (This is different from a tax deduction.)
- Tax Exemptions: Sales tax exemptions are applied at the time of purchase for your solar panels. Property tax exemptions let you exclude the value that your solar panels add when you calculate the amount of property tax you need to pay.
- Net Metering: Net metering factors in after your solar panels are up and running. If you have a net metering agreement in place with your Lincoln utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some locations, this is a dollar-for-dollar credit, while in other places you may be refunded a percentage of the value.
- Rebates: Solar companies may help you claim a rebate, or partial refund after purchase, for your solar system. Counties or states will also offer limited-time rebates at various times. The value of a rebate will usually be deducted from the total price before tax credits are calculated.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some familiarity with. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit equal to a specified percentage of the money you spend installing solar panels.
The ITC applies to solar panels installed on your primary or secondary residence in the United States. The solar system must have been installed on a property you own after January 1, 2006 for you to be eligible for the credit. The ITC originally paid out 30% of all system installation costs (panels, accessories, equipment and labor), although this amount has fluctuated slightly over the years between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the claim amount.
Reaching out to your local Lincoln solar panel installation expert is the best way to understand how the ITC could apply to you.
The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as renaming it to the Clean Energy Credit). Under the new program, solar installation projects started after January 1, 2022 and completed by the end of 2032 may be eligible for a 30% tax credit. The amount of the credit will then see a slight annual decrease until the current Clean Energy Credit expires in 2035. Starting in 2023, the program expansion will also make it easier to get credit for energy storage systems.
More information about the new Inflation Reduction Act can be found here. Your local Lincoln solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it will apply to you.
State & Local Solar Incentives
Tax credits, rebates and more might be claimed at multiple levels. On top of federal solar incentives, there are often state and local ones as well. Certain incentives are ongoing, while others may only be available for a limited time. Solar incentives might be given by your county or municipality, or by the Michigan government.
Next Steps for Installing Solar in Lincoln
You can apply for solar incentives from the federal government and the Michigan government, as well as from your local utility company. The increased availability of solar initiatives over the last 15 years has helped greatly increase nationwide adoption of solar energy. Speaking with your local Lincoln solar panel installation company is the best first step towards getting all the incentives you qualify for when you switch to solar energy.
EcoWatch's Lincoln, 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.