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

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

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

Solar incentives help mitigate the cost of installing a solar panel system on your home. This category of financial incentives is intended to encourage more Americans to switch their home over to renewable energy. Incentives can include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are handled federally, while others are offered by the Ohio government or your utility company, county or municipality. Categories of solar incentives include:

• Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that is generally considered part of your taxable income. In most cases, there is a small threshold of energy production to meet before your solar system can earn SRECs or similar performance-based incentives. SRECs and similar incentives are typically handled at the state level.
• Net Metering: You may be able to sign a net metering contract with your Lake utility company. This agreement may apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then subtract this value from your monthly utility bill.
• Rebates: Solar rebates can be provided by your state or county, or by your local utility company. These rebates are essentially partial refunds that are applied after you pay for solar panels and before tax credits are calculated.
• Tax Exemptions: Sales tax exemptions are effective at the time of purchase for your solar system. Property tax exemptions allow you to ignore the value added by your solar system when you're calculating how much property tax you need to pay on your home.
• 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.)

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Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have heard of. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit equal to a specified percentage of the money you spend on solar panels for your home.

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

To know exactly how much money the ITC could save you, talk to your local Lake solar panel installer.

The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). The Clean Energy Credit is valid until 2035. Solar installation projects started after January 1, 2022, and completed by the end of 2032 may qualify for a 30% tax credit; the amount will decrease slightly on a yearly basis until the current program ends. The expansion to the program 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 Lake solar panel company is the best resource for answering your questions about the new Clean Energy Credit and how it will apply to you.

State & Local Solar Incentives

There are often also state solar incentives in addition to those provided by the federal government. Rebates, tax credits and more might be available at a more local level. These incentives — which might be given by the state of Ohio, or by your county or municipality — could be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Lake

There are a number of different solar incentives: those given by the federal government, those given by the Ohio government and those provided by local utility companies, to name a few. The use of solar energy has increased enormously in the last 15 years, partially due to these incentives. It is a good idea to talk to your local Lake solar installer for more information about these incentives and to make sure that you're getting the most money possible for your solar panels.