2024 Solar Incentives Guide for Melvindale, MI - Tax Credits & Rebates

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

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

The phrase "solar incentives" generally refers to financial incentives that are in place to encourage the adoption and use renewable energy by making solar panels more affordable. These incentives could include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are handled by the federal government, some by the state of Michigan and some by your utility company, county or municipality. Some broad categories of solar incentives include:

• Tax Exemptions: Tax exemptions may come in one of two forms. The first is sales tax exemption, which is applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when paying property tax on your home.
• Rebates: Solar rebates can be offered by your local utility company, or by your state or county. These rebates work as partial refunds that are applied after your purchase of solar panels and before tax credits are calculated.
• Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
• Net Metering: Net metering becomes relevant after your solar panels are up and running. If you have in place a net metering agreement with your Melvindale utility company, it will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in other areas you might make back 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. A federal incentive that most people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a specified percentage of the cost of your solar system.

The ITC can be credited towards the value of a solar system installed on your primary or secondary residence in the United States. The solar panels must have been installed after January 1, 2006, on a property owned by you for you to claim the credit. Initially, the ITC applied to 30% of all system installation costs (panels, equipment, labor and accessories), although the 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.

Your local Melvindale solar panel installer can provide you with more information about the ITC and how it may apply to your situation.

In August 2022, the ITC (now called the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. Under the new program, solar installation projects begun after January 1, 2022, and finished by December 31, 2032, can 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. The program expansion also makes claiming credit for energy storage systems easier than ever before, starting in 2023.

More information about the new Inflation Reduction Act can be found here. Your local Melvindale solar panel installation experts can answer your questions and explain how the new Clean Energy Credit may apply to you.

State & Local Solar Incentives

In addition to those provided at the federal level, there are often also state solar incentives. Tax credits, rebates and more might be available at a more local level. Incentives may be given by your county or municipality, or by the state of Michigan. Certain incentives might only be available for a limited time, while others are ongoing.

Next Steps for Installing Solar in Melvindale

The nationwide use of solar energy has gone up tremendously in the last 15 years, in part due to the proliferation of solar incentives. You can obtain these incentives from your local utility company, the federal government or the Michigan government. Speak with your local solar panel installation expert today to discover more about the various programs and to save the most money possible on a solar system for your Melvindale home.