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

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

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

The phrase "solar incentives" generally refers to financial incentives implemented by the government and by solar companies to encourage the use of renewable energy by making installing and using solar panels more affordable. The incentives can include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are handled by the federal government, some by the Ohio government and some by your specific utility company, county or municipality. Types of solar incentives might include:

• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are typically handled at the state level. Once your solar system meets the qualification threshold (usually a small amount of energy production), you can receive SRECs that you can then sell to your utility company or other buyers. The money you receive is usually considered part of your taxable income.
• Tax Exemptions: Sales tax exemptions are effective at the point of sale for your solar panels. Property tax exemptions allow you to exclude the value that your solar panels add when you calculate the amount of property tax you need to pay on your home.
• Net Metering: Net metering factors in after your solar system is up and running. If you have a net metering agreement with your St Marys utility company, it will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some areas, this is a dollar-for-dollar credit, while in others you may get refunded a percentage of the value.
• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
• Rebates: Rebates, or partial refunds after a purchase, are normally applied before any solar tax credits are calculated. Rebates can be offered by your local utility company, by your state or by your county.

Federal Solar Incentives

When people think of solar incentives, federal incentives may be the first thing that comes to mind. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a percentage of your solar system's cost.

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

To better understand exactly how much money the ITC could save you, speak with your local St Marys solar panel installer.

The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar installations undertaken between January 1, 2022 and December 31, 2032. After 2032, the percentage will decrease slightly each year until the end of the program in 2035. Starting in 2023, it will also be easier to qualify for credits for energy storage systems with the new act.

More information about the new Inflation Reduction Act can be found here. Your local St Marys solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it may apply to you.

State & Local Solar Incentives

Rebates, tax credits and more can be claimed at multiple levels. Along with federal solar incentives, there are often state and local ones as well. These solar incentives — which may be handled by your county or municipality, or by the state of Ohio — could be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in St Marys

There are many types of solar incentives: those offered by local utility companies, those offered by the federal government and those offered by the Ohio government, to name a few. The use of solar energy has increased enormously in the last 15 years, partially thanks to these incentives. We suggest talking to your local St Marys solar installation company to learn more about these incentives and to ensure that you're getting all of the money you can for your solar system.