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

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

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

Solar incentives are designed to make renewable energy usage more affordable via financial incentives for those who install solar panels on their homes. Various types of incentives, like discounts, cash back or monthly utility bill credits, may be available to you. Certain incentives may be provided via the state of Ohio, by your utility company or by county or municipality, while others are federal. Categories of solar incentives include:

• Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the federal government.
• Net Metering: Net metering is an incentive you can get once your solar panels are up and running. If you've signed a net metering agreement with your Richland utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some places, this is a dollar-for-dollar credit, while in other areas you may receive a refund equivalent to a percentage of the value.
• Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce over a threshold (usually small) amount of electricity will qualify for SRECs or similar performance-based incentives. SRECs and the like are typically given by your state government. You can sell SRECs to your utility company or another buyer, and this is usually considered part of your taxable income.
• Rebates: Solar rebates may be offered by your local utility company, or by your county or state. These rebates work as partial refunds that are applied after your purchase of a solar system and before tax credits are calculated.
• Tax Exemptions: These can come in the form of property tax exemptions, which allow you to ignore 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.

Federal Solar Incentives

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

The ITC initially applied to 30% of the cost of installing a solar system, and has fluctuated slightly over the years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total installation cost includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum claim amount. The ITC can be applied to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.

Reaching out to your local Richland solar panel installer is the best way to understand how the ITC applies to your situation.

In August 2022, the ITC (now titled the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. The new Clean Energy Credit extends until 2035. American homeowners are now eligible for a 30% credit for solar systems that began installation after January 1, 2022 and are completed by the end of 2032. This credit will then be decreased by a few percentage points every year until its expiration. Beginning in 2023, it will also be easier to claim credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. The best way to understand how the new Clean Energy Credit will apply to you is to reach out to your local Richland solar panel company with your questions.

State & Local Solar Incentives

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

Next Steps for Installing Solar in Richland

There are a variety of solar incentives: those given by local utility companies, those given by the federal government and those given by the Ohio government, to name a few. The use of solar energy has grown enormously in the last 15 years, partially thanks to these incentives. Your local Richland solar panel installer can give you more information about which incentives you should apply for, and get you started on the path to switching to renewable energy today.