2025 Solar Incentives Guide for American, OH - Tax Credits & Rebates

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

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

Solar incentives are designed to make renewable energy usage more affordable through financial incentives to help people install solar panels on their homes. The incentives might include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are provided by the federal government, some by the state of Ohio and some by your utility company, county or municipality. You might qualify for any of the following types of solar incentives:

• Rebates: Rebates, or cash back after a purchase, are typically given before any solar tax credits are calculated. These rebates can be provided by your local utility company, by your county or by your state.
• Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the federal government. (A tax credit is different from a tax deduction.)
• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are normally handled at the state level. Once your solar panel system meets a predetermined threshold (typically a small amount of energy production), you are eligible to receive SRECs that can be sold to your utility company or other buyers. The money you make is generally considered part of your taxable income.
• Net Metering: Net metering is an incentive you can get once your solar panels are up and running. If you've signed a net metering agreement with your American utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in others you might receive a refund equivalent to a percentage of the value.
• Tax Exemptions: Tax exemptions may come in two forms. The first is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when calculating property tax for your house.

Federal Solar Incentives

When you hear the term "solar incentives," federal incentives might be the first thing that comes to mind. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a certain percentage of your solar system's cost.

The ITC was originally for 30% of the cost of installing a solar system, and has fluctuated slightly over the last few years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total cost of installation includes the panels themselves as well as the cost of accessories, equipment and labor. There is no maximum claim amount. The ITC applies to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.

Wondering how the ITC applies to your specific situation? Contact your local American solar panel installation expert to get more information.

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. For solar system installations that begin after January 1, 2022, and are completed by the end of 2032, homeowners can receive a credit equal to 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit ends in 2035. The expansion also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.

More information about the new Inflation Reduction Act can be found here. The easiest way to learn more about how the new Clean Energy Credit applies to you is to get in touch with your local American solar panel installers.

State & Local Solar Incentives

Some solar incentives may be provided at the state and local level. Similar to federal incentives, these might include tax credits, rebates and more. Some incentives are offered for only a limited time, while others are ongoing. Local solar incentives may come from your county or municipality, or from the Ohio government.

Next Steps for Installing Solar in American

The expanding number of available solar incentives has contributed greatly to the increase in the adoption of solar energy nationwide over the past 15 years. You might qualify for solar incentives from your local utility company, the Ohio government or the federal government. Your local American solar panel installation company can help you learn more about which incentives you should apply for, and get you started on the path to switching to renewable energy today.