2024 Solar Incentives Guide for Parma, OH - Tax Credits & Rebates

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

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. These incentives could include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are given 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:

• Tax Exemptions: These could come in the form of property tax exemptions, which let you exclude the value of your solar system when calculating the taxes you pay on your home. You could also look for exemptions on sales tax at the time of purchase.
• Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the federal government.
• Rebates: Some solar companies will help you claim a rebate, or partial refund of your purchase, for your solar panels. Counties or states will also sometimes offer limited-time rebates. Any rebates you receive will usually come off your total price before any tax credits are calculated.
• Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce more than a predetermined (generally small) amount of electricity can qualify for SRECs or other similar performance-based incentives. SRECs and similar incentives are typically given at the state level. SRECs can be sold to your utility company or another buyer, and this is usually considered part of your taxable income.
• Net Metering: Net metering factors in once your solar panels are up and running. If you have in place a net metering agreement with your Parma utility company, it will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this credit is dollar-for-dollar, while in other places you may 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. An incentive many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a given percentage of your solar system's cost.

The ITC covers solar systems installed after January 1, 2006, and allows you to deduct from your taxes a percentage of the total cost of solar panels, accessories, equipment and labor. This credit can apply towards solar panels installed on a primary or secondary residence that you own in the United States. The original claim amount was 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum claim amount.

Have questions about how the ITC applies to your specific situation? Contact your local Parma solar panel installation expert to get more information.

In August 2022, the ITC (now referred to as the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. Under the new program, solar installation projects started after January 1, 2022, and completed by the end of 2032, might qualify for a 30% tax credit. The amount of the credit will then see a slight annual decrease until the end of the current Clean Energy Credit in 2035. Starting in 2023, the expansion will also make it easier to get credit for energy storage systems.

Click here to learn more about the new Inflation Reduction Act. To fully understand how the new Clean Energy Credit might apply to you, talk to your local Parma solar installation company.

State & Local Solar Incentives

Some solar incentives are often also provided by state and local governments. As with federal incentives, these may include tax credits, rebates and more. Some incentives are ongoing, while others might only be available for a limited time. They may be offered by the Ohio government, or by your county or municipality.

Next Steps for Installing Solar in Parma

Solar energy use nationwide has significantly increased in the last 15 years, in part thanks to the increase in availability of solar incentives. You might receive these incentives from the Ohio government, the federal government or your local utility company. We suggest talking to your local Parma solar installation expert for more information about these incentives and to ensure that you're getting all the money you can for your solar panels.