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

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

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

The term "solar incentives" broadly refers to financial incentives designed to encourage the use of renewable energy by making installing and using solar panels more affordable. Solar incentives might include cash back, upfront discounts 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. Categories of solar incentives include:

• Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the federal government.
• Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for money that typically becomes part of your taxable income. Typically, a certain (small) threshold of energy production must be met before your solar system qualifies for SRECs or similar performance-based incentives. Incentives like these are normally handled by your state government.
• Net Metering: Net metering factors in once your solar system is up and running. If you have a net metering agreement with your Upper utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in other areas you may make back a percentage of the value.
• Tax Exemptions: Your solar panels might qualify for exemptions on both sales and property tax. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions allow you to exclude the value that solar panels add when calculating property taxes on your home.
• Rebates: A rebate is a partial refund after the purchase of your solar system. These could be offered by your local utility company, your county or your state. The rebates are usually applied before tax credits are calculated.

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Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some familiarity with. A federal incentive many people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a specified percentage of your solar system's cost.

The ITC can be applied to solar systems installed after January 1, 2006, and lets you deduct from your taxes a percentage of the total cost of solar panels, equipment, accessories and labor. This credit can be claimed on a solar panel system 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 certain projects may qualify for only 26%, depending on the details. There is no maximum claim amount.

To more fully understand how the ITC might apply to your situation, speak to your local Upper solar panel installer and ask for more information.

The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar systems installed between 2022 and 2032. At this point, the percentage will see a slight decrease annually until the program expires in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems with the new act.

More information about the new Inflation Reduction Act can be found here. Your local Upper solar panel company can answer any questions you have and explain how the new Clean Energy Credit will apply to you.

State & Local Solar Incentives

Some solar incentives may be provided at the state and local level. Similar to federal incentives, these might include tax credits, rebates and more. These incentives — which may be provided 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 Upper

There are many kinds 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. Solar energy use has increased tremendously in the last 15 years, thanks to these incentives. Call your local solar panel installation expert today to learn more and to save as much money as possible on solar panels for your Upper home.