2023 Solar Incentives Guide for Doylestown, PA - Tax Credits & Rebates

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

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

The term "solar incentives" broadly refers to financial incentives that are in place to encourage the use of renewable energy by making solar panels more affordable. Different types of incentives, like discounts, cash back or credit towards your monthly utility bill, may be available to you. Some incentives may be handled by the state of Pennsylvania, by your utility company or by county or municipality, while other incentives are federal. Some broad categories of solar incentives include:

• Rebates: Solar companies may help you claim a rebate, or partial refund after purchase, for your solar system. States or counties will also offer limited-time rebates at various times. Any rebates you receive will usually be deducted from the total price before any tax credits are calculated.
• Tax Exemptions: Your solar system may qualify for both sales tax and property tax exemptions. Sales tax exemptions are applied at the time of purchase. Property tax exemptions let you exclude the value that solar panels add when you are calculating property taxes on your home.
• Solar Renewable Energy Certificate (SREC): SRECs and other similar performance-based incentives are normally handled by your state government. Once your solar panel system meets the qualification threshold (normally a small amount of energy production), you are eligible to receive SRECs that can be sold to your utility company or other buyers. The money you make is generally considered part of your taxable income.
• Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (This is different from a tax deduction.)
• Net Metering: Net metering factors in once your solar panels are up and running. If you have in place a net metering agreement with your Doylestown utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this credit is dollar-for-dollar, while in others you may receive a refund equivalent to a percentage of the value.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have heard of. One of the incentives many people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a given percentage of your solar system's cost.

The ITC can be applied to the total cost of solar panel installation, including the panels themselves as well as equipment, accessories and labor. You can claim this credit for panels installed after January 1, 2006 on a primary or secondary residence located in the United States that you own. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum amount you can claim.

To understand exactly how much the ITC could save you, contact your local Doylestown solar panel installation expert.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now referred to as the Clean Energy Credit. The Clean Energy Credit re-raises the credit up to 30% for solar installations undertaken between January 1, 2022 and December 31, 2032. After 2032, the credit percentage will decrease slightly each year until the end of the program in 2035. Starting in 2023, the program expansion will also make claiming credit for energy storage systems easier than ever before.

Click here to learn more about the new Inflation Reduction Act. The easiest way to understand how the new Clean Energy Credit applies to you is to get in touch with your local Doylestown solar panel company.

State & Local Solar Incentives

Not all solar incentives are federal; tax credits, rebates and more are often offered at the state and local level. Incentives might be offered by the state of Pennsylvania, or by your county or municipality. Some incentives may be available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in Doylestown

The nationwide use of solar energy has gone up tremendously in the last 15 years, in part due to the increase in availability of solar incentives. You might receive these incentives from your local utility company, the federal government or the Pennsylvania government. Reach out to your local solar panel installation expert today to find out more information and to save the most money possible on a solar system for your Doylestown home.