2023 Solar Incentives Guide for Parma, OH - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Parma.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Parma?
Hamilton County - Home Improvement Program
Local Option - Special Energy Improvement Districts
Energy Conservation for Ohioans (ECO-Link) Program
Solar Renewable Energy Certificates Program (SRECs)
Federal Residential Renewable Energy Tax Credit
Solar incentives are meant to help mitigate the cost of installing solar panels on your home. This category of financial incentives is in place to encourage more people to make the switch to renewable energy. Solar incentives can include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are offered by the federal government, some by the Ohio government and some by your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Tax Credits: Tax credits lower, dollar-for-dollar, the total amount of tax you owe the government. These are different from tax deductions.
- Rebates: Solar rebates may be provided by your local utility company, or by your state or county. These rebates are essentially partial refunds that are applied after your purchase of solar panels and before tax credits are calculated.
- Tax Exemptions: Tax exemptions may come in one of 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 calculating property tax for your home.
- Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are typically handled at the state level. Once your solar system meets a predetermined threshold (generally a small amount of energy production), you can receive SRECs that can be sold to your utility company or other buyers. The money you receive from the sale is generally considered part of your taxable income.
- Net Metering: Make sure you speak to your Parma utility company about signing a net metering contract. This will allow you to receive credit towards your monthly utility bill for the value of excess energy your solar panels generate. You may receive either a dollar-for-dollar credit or a percentage of the value.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some familiarity with. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a predetermined percentage of your solar system's cost.
The ITC can be applied to the total cost of installing solar panels, including the panels themselves as well as accessories, labor and equipment. You can claim this credit for panels installed after January 1, 2006 on a primary or secondary residence that you own and that is located in the United States. The tax credit ranges from 26-30% of total costs depending on when your project was completed. There is no maximum amount you can claim.
To find out exactly how much the ITC could save you, speak with your local Parma solar panel installer.
In August 2022, the Inflation Reduction Act made revisions to the ITC, now dubbed the Clean Energy Credit. Now, solar installation projects that are completed between 2022 and 2032 can qualify for a 30% tax credit. This credit amount will then decrease slightly each year until the current Clean Energy Credit expires in 2035. Starting in 2023, the program 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 applies to you, speak with your local Parma solar installation company.
State & Local Solar Incentives
In addition to federal solar incentives, there are often also state ones. Tax credits, rebates and more may be available at a more local level. Incentives might be handled by your county or municipality, or by the state of Ohio. Some incentives may be available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Parma
Solar energy use nationwide has increased enormously in the past 15 years, in part due to the increase in availability of solar incentives. You may get these incentives from your local utility company, the Ohio government or the federal government. Your local Parma solar panel installer can provide you with more details about which incentives you should apply for, and get you started on the path to switching to renewable energy today.
EcoWatch's Parma, OH Solar Incentives FAQs
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.