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

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

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

Solar incentives are intended to make renewable energy usage more affordable through financial incentives for those who install solar panels on their homes. Different kinds of incentives, like discounts, cash back or monthly utility bill credits, may be available to you. Some incentives may be handled by the state of Ohio, by your utility company or by county or municipality, while other incentives are federal. Categories of solar incentives include:

• Net Metering: Net metering factors in once your solar panels are up and running. If you have a net metering agreement with your Montgomery 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 other areas you may receive a refund equivalent to a percentage of the value.
• 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.
• Rebates: A rebate is a partial refund given after you've purchased your solar panels. Rebates could be offered by your local utility company, your county or your state. The rebates are usually applied before calculating tax credits.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are normally handled by your state government. Once your solar system meets a certain threshold (usually a small amount of energy production), you are eligible to receive SRECs that you can then sell to your utility company or other buyers. The money you receive from the sale is generally considered part of your taxable income.
• Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some knowledge of. The Federal Solar Investment Tax Credit, or ITC, is the best-known federal solar incentive. The ITC provides a tax credit for a set percentage of the cost of your solar system.

The ITC can be applied to solar panels installed after January 1, 2006 on a primary or secondary residence that you own in the United States. Initially, the credit applied to 30% of the total cost — for panels, equipment, labor and accessories — although the percentage may range from 26-30%, depending on when your solar system was installed. There is no cap on the amount you can claim.

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

In August 2022, the Inflation Reduction Act expanded and extended the ITC, now called 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; this amount will then decrease slightly each year until the current program ends. Beginning in 2023, it will also be easier to claim credits for energy storage systems under this new program.

Click here to learn more about the new Inflation Reduction Act. Your local Montgomery solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it will apply to you.

State & Local Solar Incentives

Some solar incentives are often also provided by state and local governments. Similar to federal incentives, these may include rebates, tax credits and more. The incentives — which might be given by your county or municipality, or by the state of Ohio — may be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Montgomery

There are many kinds of solar incentives: those given by local utility companies, those given by the Ohio government and those given by the federal government, to name a few. The use of solar energy has grown tremendously in the last 15 years, partially thanks to these incentives. Your local Montgomery 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.