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

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

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

The term "solar incentives" generally refers to financial incentives designed to encourage the adoption and use renewable energy by making the installation and use of solar panels more affordable. The incentives may 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 utility company, county or municipality. Some solar incentives you might qualify for are:

• Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that is generally considered part of your taxable income. Typically, a certain (small) threshold of energy production must be met before your solar system can earn SRECs or other performance-based incentives. SRECs and similar incentives are normally handled by your state government.
• Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the federal government.
• Tax Exemptions: Sales tax exemptions are applied at the time of purchase for your solar panels. Property tax exemptions allow you to ignore the added value of your solar system when calculating how much property tax you need to pay on your house.
• Net Metering: Net metering factors in once your solar panels are up and running. If you have a net metering agreement with your Vernon utility company, they will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some areas, this is a dollar-for-dollar credit, while in other places you might make back a percentage of the value.
• Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar system. Rebates may be offered by your local utility company, your county or your state. The rebates are usually applied before tax credits are calculated.

Federal Solar Incentives

Federal solar incentives are probably the first thing that comes to mind when thinking about solar incentives. You may have heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit equal to a predetermined percentage of the money you spend on your solar system.

The ITC initially applied to 30% of the total cost of installing a solar system, although it has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total cost of installation includes the panels themselves as well as the cost of labor, equipment and accessories. There is no maximum amount you can claim. 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.

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

In August 2022, the ITC (now referred to as the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. For solar systems installed between January 1, 2022 and December 31, 2032, homeowners may be eligible for a credit for 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit ends in 2035. Starting in 2023, the program expansion will also make it easier to get credit for energy storage systems.

More information about the new Inflation Reduction Act can be found here. To best understand how the new Clean Energy Credit might apply to you, reach out to your local Vernon solar installation expert.

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. The incentives — which may be given by the state of Ohio, or by your county or municipality — might be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Vernon

Solar incentives may be provided by the federal government, the Ohio government or your local utility company. The large number of solar incentives available has facilitated the nationwide growth of solar energy use in the last 15 years. When you're prepared to make the change to solar energy, reaching out to your local Vernon solar panel installation expert is an excellent place to start.