2023 Solar Incentives Guide for Middlefield, OH - Tax Credits & Rebates

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

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

The term "solar incentives" covers a range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. You might be eligible for different kinds of incentives, such as discounts, cash back or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the Ohio government and others from the federal government. Categories of solar incentives include:

• Net Metering: Net metering factors in after your solar system is up and running. If you've signed a net metering agreement with your Middlefield utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some locations, this is a dollar-for-dollar credit, while in other places you may receive a refund equivalent to a percentage of the value.
• Tax Credits: Tax credits lower, dollar-for-dollar, the total amount of tax you owe the federal government. These differ from tax deductions.
• Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce over a specific (normally small) amount of electricity can qualify for SRECs or other similar performance-based incentives. SRECs and performance-based incentives in general are typically provided by your state government. When you receive an SREC, you can sell it to your utility company or another buyer, and this is usually considered part of your taxable income.
• 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. This allows you to ignore the added value of your solar system when paying property tax on your home.
• Rebates: A solar rebate is a partial refund given after you've purchased your solar system. Rebates might be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.

Federal Solar Incentives

When you think about solar incentives, you likely think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC offers a tax credit for a set percentage of your solar system's cost.

The ITC can be applied to solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, labor, accessories and equipment. You can claim 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 certain projects may qualify for only 26%, depending on the details. There is no maximum claim amount.

Your local Middlefield solar panel installation expert can give you more information about the ITC and how it may apply to your situation.

The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit lasts 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 be decreased slightly each year until the end of the current program. Starting in 2023, the expansion to the program will also make credits for energy storage systems even easier to claim.

Click here to learn more about the new Inflation Reduction Act. Your local Middlefield solar panel installer can answer any questions you have and explain how the new Clean Energy Credit applies to you.

State & Local Solar Incentives

Some solar incentives are often also offered at the local or state level. As with federal incentives, these can include rebates, tax credits and more. These incentives may be distributed by the Ohio government, or by your county or municipality. Certain incentives are ongoing, while others are available for a limited time.

Next Steps for Installing Solar in Middlefield

There are a number of different solar incentives: those given by the federal government, those given by the Ohio government and those given by local utility companies, to name a few. Solar energy utilization has grown tremendously in the last 15 years, partially thanks to these incentives. If you're ready to make the change to solar energy, getting in touch with your local Middlefield solar panel installation expert is a great first step.