2023 Solar Incentives Guide for Madison Heights, MI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Madison Heights.
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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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Madison Heights?
Michigan Saves - Home Energy Loan Program
Federal Residential Renewable Energy Tax Credit
Solar incentives encourage homeowners to switch their home over to renewable energy by providing financial incentives meant to lower the burden of solar panel installation and use. Incentives may include things like discounts, cash back or monthly utility bill credits. Some incentives are offered by the federal government, while others are handled by the state of Michigan or your specific utility company, county or municipality. Some solar incentives you might qualify for are:
- Tax Exemptions: These may come in the form of property tax exemptions, which would allow you to exclude the value of your solar system when calculating the taxes you pay on your house. You could also look for exemptions on sales tax at the time of purchase.
- Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
- Net Metering: Net metering becomes relevant once your solar panels are up and running. If you have a net metering agreement with your Madison Heights utility company, it will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in other areas you might make back a percentage of the value.
- Rebates: Rebates, or partial refunds after a purchase, are normally given prior to any solar tax credits being calculated. Rebates may be given by your local utility company, by your state or by your county.
Federal Solar Incentives
When someone says "solar incentives," you probably think of federal incentives first. An incentive that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a specified percentage of the cost of your solar system.
The ITC can be applied to solar systems installed after January 1, 2006 on a primary or secondary residence that you own in the United States. Originally, the tax credit was for 30% of the total cost — for panels, accessories, labor and equipment — although it may range from 26-30%, depending on the installation date of your solar system. There is no cap on the claim amount.
To better understand how the ITC may apply to your situation, reach out to your local Madison Heights solar panel installer and request more information.
In August 2022, the Inflation Reduction Act expanded and extended the ITC, now called the Clean Energy Credit. The new Clean Energy Credit extends until 2035. Homeowners can now apply for a 30% credit for solar systems that began installation after January 1, 2022 and are completed by the end of 2032. The total credit will then decrease annually until it expires. Starting in 2023, the program expansion will also make claiming credit for energy storage systems easier than ever before.
Click here to learn more about the new Inflation Reduction Act. The best way to learn more about how the new Clean Energy Credit will apply to you is to speak with your local Madison Heights solar panel installers directly.
State & Local Solar Incentives
There are often also state solar incentives in addition to those provided by the federal government. Tax credits, rebates and more might be available at a more local level. Certain incentives are ongoing, while others are available for a limited time. These incentives might be given by your county or municipality, or by the Michigan government.
Next Steps for Installing Solar in Madison Heights
The large number of solar incentives available has enormously increased the nationwide adoption of solar energy over the past 15 years. You might qualify for solar incentives from your local utility company, the Michigan government or the federal government. If you're prepared to make the switch to solar energy, talking to your local Madison Heights solar panel installation expert is an excellent place to start.
Michigan Solar Solutions
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EcoWatch's Madison Heights, MI Solar Incentives FAQs
If I already have solar panels, can I still claim incentives?
If your solar panels were installed after January 1, 2022, you may qualify for the newly increased 30% tax credit under the Inflation Reduction Act. If you installed your system between 2006 and 2021, you might qualify for a tax credit between 26% and 30%, depending on the date of installation. Talking to the company that installed your system, or any local Madison Heights solar installer, can help you understand what incentives you qualify for.
Who installs solar panel systems near me?
To find the right solar panel installer for you, check out our guide to Madison Heights' top solar panel companies.
What are some of the environmental benefits of switching to solar?
Solar energy is a renewable energy source — by changing where you get your energy, you can help lessen the strain on our planet's resources. A solar system can also reduce your home's CO2 emissions by 500 pounds yearly, or around 10,000 pounds in 20 years.
How long until the federal solar tax credit ends?
The Clean Energy Credit (previously called the federal solar tax credit, or ITC), is slated to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I apply for incentives both towards the up-front cost of solar panels, and later as reimbursement?
Yes, you can claim both tax credits and rebates towards the cost of solar panels. Depending on precisely which incentives you are claiming, they may apply in a different order. Be sure to talk to your solar installer or a local tax professional to verify that you are claiming the correct incentives and getting the most money you can.
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.