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

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

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

Solar incentives help mitigate the cost of installing a solar panel system on your home. These financial incentives are intended to encourage more Americans to convert their home partially or fully to renewable energy. These incentives might include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are given by the federal government, some by the state of Pennsylvania and some by your utility company, county or municipality. Some solar incentives you might qualify for are:

• Rebates: Rebates, or partial refunds after a purchase, are usually given prior to any solar tax credits being calculated. These rebates may be given by your local utility company, by your state or by your county.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives may be available to you if you have a solar system that produces over a specified (generally small) amount of electricity. This category of incentives is generally handled at the state level. You can sell any SRECs you have to your utility company or other buyers, and the money you make is typically considered part of your taxable income.
• Tax Exemptions: Tax exemptions can come in two forms. First, there is sales tax exemption, applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when paying property tax on your home.
• Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you have in place a net metering agreement with your Northwest Harborcreek 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 is a dollar-for-dollar credit, while in other places you might make back a percentage of the value.
• Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.

Federal Solar Incentives

When thinking about solar incentives, federal incentives are likely the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is likely the most commonly known federal solar incentive. The ITC provides a tax credit for a specific percentage of your solar system's cost.

The ITC covers solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, equipment, labor and accessories. You can claim this credit for a solar panel system installed on a primary or secondary residence in the United States that you own. The original amount you could claim was 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum amount you can claim.

Speaking with your local Northwest Harborcreek solar panel installation expert is the best way to learn more about how the ITC could apply to you.

The ITC has been renewed and expanded following the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. With the new provisions, solar installation projects begun after January 1, 2022 and finished by December 31, 2032 can qualify for a 30% tax credit. This credit amount will then decrease slightly each year until the end of the current Clean Energy Credit in 2035. Beginning in 2023, it will also be easier to obtain credits for energy storage systems under the new laws.

More information about the new Inflation Reduction Act can be found here. To fully understand how the new Clean Energy Credit will apply to you, speak with your local Northwest Harborcreek solar installation expert.

State & Local Solar Incentives

There are more than just federal solar incentives; tax credits, rebates and more may be offered at the state and local level. The incentives — which might be handled by the state of Pennsylvania, or by your county or municipality — could be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Northwest Harborcreek

There are a variety of solar incentives: those provided by the federal government, those provided by the Pennsylvania government and those provided by local utility companies, to name a few. The use of solar energy has increased tremendously in the last 15 years, partially thanks to these incentives. Speaking with your local Northwest Harborcreek solar panel installation expert is an excellent first step towards making sure you get all the incentives you qualify for when you switch to solar energy.