2023 Solar Incentives Guide for Royal Oak, MI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Royal Oak.
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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Updated March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Royal Oak?
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Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are intended to encourage homeowners to switch to renewable energy by providing financial incentives meant to lower the burden of solar panel installation and use. Incentives can include things like discounts, cash back or credit on your utility bill each month. Some incentives are provided by the federal government, while others are handled by the state of Michigan or by your specific utility company, county or municipality. Some solar incentives you might qualify for are:
- Rebates: Your solar installer might help you claim a rebate, or partial refund of your purchase, for your solar system. Counties or states will also offer limited-time rebates at various times. The value of a rebate will usually come off your total price before any tax credits are calculated.
- Net Metering: Net metering becomes relevant once your solar system is up and running. If you've signed a net metering agreement with your Royal Oak utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this is a dollar-for-dollar credit, while in others you may be refunded a percentage of the value.
- Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the federal government.
- Tax Exemptions: These might come in the form of property tax exemptions, which let you exclude the value of your solar system when paying property tax on your home. You may also qualify for an exemption on sales tax at the time of purchase.
Federal Solar Incentives
When thinking about solar incentives, federal incentives might be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is probably the most commonly known federal solar incentive. The ITC provides you with a tax credit for a set percentage of the cost of your solar system.
The ITC originally covered 30% of the cost of installing a solar system, although it has fluctuated slightly over time between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total installation cost includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum amount you can claim. The ITC applies to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be owned by you and in the United States.
Your local Royal Oak solar panel installer can provide you with more information about the ITC and how it might apply to your situation.
The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The Clean Energy Credit lasts until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit. The amount will then decrease slightly each year until the current program ends. Beginning in 2023, it will also be easier to qualify for credits for energy storage systems under the new laws.
More information about the new Inflation Reduction Act can be found here. To fully understand how the new Clean Energy Credit might apply to you, reach out to your local Royal Oak solar installation expert.
State & Local Solar Incentives
Federal solar incentives are not your only option; rebates, tax credits and more may be offered at the state and local level. These incentives might be given out by your county or municipality, or by the Michigan government. Certain incentives are ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Royal Oak
The large number of available solar incentives has contributed greatly to the increase in the adoption of solar energy nationwide over the last 15 years. You might qualify for solar incentives from your local utility company, the federal government or the Michigan government. Your local Royal Oak solar panel installation expert can give you more information about which incentives you should apply for, and get you started on the path to switching to renewable energy today.
Solar Veteran
Michigan Solar Solutions
- Great warranty coverage
- Outstanding customer service
- Offers products from leading manufacturers
- Slightly limited service offerings
- No leases or PPAs
Outstanding Local Installer
Strawberry Solar
- Outstanding customer service
- Representatives are experts on local policies
- Educational, no-pressure sales approach
- Limited warranty coverage
- No leases or PPAs
- Limited brands of solar equipment available
EcoWatch's Royal Oak, MI Solar Incentives FAQs
Can I claim incentives for adding solar panels to a rental property, vacation home or commercial property?
Many solar incentives are intended to apply to a property you own that is located within the United States, and most secondary residences will fall into this category. Other solar incentives may be available for commercial properties, depending on the details. We recommend getting in touch with your local solar installer and/or tax professional to better understand what incentives may apply to your specific situation.
If I already have a solar system installed on my house, can I still claim incentives?
Your best bet is to talk to someone from the company that installed your solar panels — or reach out to a local Royal Oak solar installer — to learn about which incentives you might qualify for. If your solar panels were installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
What are the highest-rated solar panel installation companies near me?
To find the right solar panel installer for you, check out our guide to Royal Oak's top solar panel companies.
I want to change out my appliances for ones that are more energy-efficient. Are there any benefits I can apply for?
With the passage of the new Inflation Reduction Act, there are a number of new financial incentives for making eco-friendly improvements to your home. More details on these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I apply for incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can claim both rebates and tax credits towards the cost of solar panels. Depending on which incentives you are eligible for, they may apply in a different order. Make sure that you talk to your solar installer or a local tax professional to verify that you are claiming incentives correctly 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.