2023 Solar Incentives Guide for Kannapolis, NC - Tax Credits & Rebates

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

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

The phrase "solar incentives" includes a range of financial incentives put in place to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Incentives could include things like discounts, cash back or monthly utility bill credits. Some incentives are handled federally, while others are offered by the North Carolina government or by your utility company, county or municipality. Categories of solar incentives include:

• Rebates: Rebates, or partial refunds after a purchase, are usually applied prior to any solar tax credits being calculated. Rebates might be given by your local utility company, by your county or by your state.
• Tax Exemptions: Your solar panels may qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to ignore the added value of the solar panels when calculating property taxes on your home.
• Net Metering: Be sure to talk with your Kannapolis utility company about signing a net metering contract. This will allow you to receive credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You could receive either a dollar-for-dollar credit or a percentage of the value.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives may be available to you if the solar system on your home produces more than a specified (typically small) amount of electricity. These types of incentives are generally handled at the state level. You can sell your SRECs to your utility company or other buyers, and the money you make is normally considered part of your taxable income.
• Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (A tax credit is different from a tax deduction.)

Federal Solar Incentives

Federal solar incentives are probably the first thing that you think of when thinking about solar incentives. A federal incentive many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a predetermined percentage of your solar system's cost.

The ITC can be applied to solar systems installed after January 1, 2006 and under this program you can deduct from your taxes a percentage of the total cost of solar panels, accessories, labor and equipment. You can receive this credit for solar panels installed on a primary or secondary residence in the United States that you own. The original claim amount was 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum amount you can claim.

To more fully understand how the ITC will apply to your situation, speak to your local Kannapolis solar panel installation expert and request more information.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now called the Clean Energy Credit. Now, solar installation projects started after January 1, 2022 and completed by the end of 2032 might qualify for a 30% tax credit. This credit amount will then decrease slightly each year until the current Clean Energy Credit expires in 2035. The expansion to the program also makes claiming credit for energy storage systems easier than ever before, starting in 2023.

Click here to learn more about the new Inflation Reduction Act. Your local Kannapolis solar panel company can answer your questions and explain how the new Clean Energy Credit applies to you.

State & Local Solar Incentives

In addition to those provided at the federal level, there are often also state solar incentives. Rebates, tax credits and more may be available at a more local level. Certain incentives are ongoing, while others are offered for only a limited time. Your local incentives may come from your county or municipality, or from the North Carolina government.

Next Steps for Installing Solar in Kannapolis

Solar incentives can be offered by the North Carolina government, the federal government or your local utility company. The growing number of available incentives has facilitated the nationwide growth of solar energy use in the last 15 years. When you're prepared to make the switch to solar energy, calling your local Kannapolis solar panel installation expert is a great first step.