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

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

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

The phrase "solar incentives" refers to a wide 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. You might qualify for several types of incentives, including cash back, discounts or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the Ohio government and others from the federal government. Some solar incentives you might qualify for are:

• Tax Exemptions: Tax exemptions may come in two forms. First, there is sales tax exemption, applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when paying property tax on your home.
• Rebates: A rebate is a partial refund given after you've purchased your solar system. Rebates may 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.
• Solar Renewable Energy Certificate (SREC): SRECs and other similar performance-based incentives are typically handled at the state level. Once your solar system meets a certain threshold (normally a small amount of energy production), you can receive SRECs that can then be sold to your utility company or other buyers. The money you make from the sale is usually considered part of your taxable income.
• Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
• Net Metering: Net metering factors in after your solar panels are up and running. If you have a net metering agreement with your Orwell utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some places, this credit is dollar-for-dollar, while in others you might get refunded a percentage of the value.

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Federal Solar Incentives

Federal solar incentives are likely to be the first thing that you think of when thinking about solar incentives. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a predetermined percentage of your solar system's cost.

The ITC can be applied to a solar system installed on your primary or secondary residence in the United States. The solar system must have been installed on a property you own after January 1, 2006 for you to be eligible for the credit. Originally, the ITC covered 30% of all system costs (panels, accessories, labor and equipment), although this amount has fluctuated slightly over the last few years between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the amount you can claim.

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

The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as retitling it the Clean Energy Credit). Homeowners can now receive a credit of 30% of the total solar system installation costs for projects started after January 1, 2022 and completed before the end of 2032. The percentage will then decrease yearly until the Clean Energy Credit ends in 2035. The expansion also makes credits for energy storage systems even easier to claim, beginning in 2023.

Click here to learn more about the new Inflation Reduction Act. Your local Orwell solar panel installer can answer your questions and explain how the new Clean Energy Credit may apply to you.

State & Local Solar Incentives

In addition to federal solar incentives, there are often also state ones. Rebates, tax credits and more might be available at a more local level. These incentives may be handled by the Ohio government, or by your county or municipality. Some incentives may be ongoing, while others are available for a limited time.

Next Steps for Installing Solar in Orwell

You can apply for solar incentives from the Ohio government and the federal government, as well as from your local utility company. This increase in availability of solar initiatives over the last 15 years has helped increase solar adoption nationwide. Call your local solar panel installation expert today to find out more information and to save the most money possible on a solar system for your Orwell home.