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

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

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

The term "solar incentives" includes a wide range of financial incentives implemented to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. The incentives can include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are provided by the federal government, some by the state of Pennsylvania and some by your utility company, county or municipality. You might qualify for any of the following types of solar incentives:

• Rebates: Rebates, or partial refunds after a purchase, are typically given before any solar tax credits are calculated. Solar rebates may be offered by your local utility company, by your county or by your state.
• Net Metering: Don't forget to speak with your West Manchester utility company about signing a net metering agreement. This will allow you to receive credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You might receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Exemptions: Tax exemptions may come in two forms. The first is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption. This allows you to ignore the value added by your solar system when paying property tax on your home.
• Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the federal government.
• Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce over a threshold (normally small) amount of electricity can qualify for SRECs or similar performance-based incentives. SRECs and performance-based incentives in general are typically provided by your state government. You can sell SRECs to your utility company or another buyer, and this is usually considered part of your taxable income.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some knowledge of. One of the incentives many people are probably 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 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 receive this credit for a solar panel system installed on a primary or secondary residence in the United States that you own. 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 amount you can claim.

Contacting your local West Manchester solar panel installer is the best way to understand how the ITC may apply to your situation.

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. The new Clean Energy Credit extends until 2035. Homeowners are now eligible for a 30% credit for solar systems that began installation on or after January 1, 2022 and will be done by December 31, 2032. The total credit will then decrease annually until the date of expiration. Beginning in 2023, it will also be easier to get credits for energy storage systems under the new laws.

Click here to learn more about the new Inflation Reduction Act. Your local West Manchester solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it will apply to you.

State & Local Solar Incentives

Some solar incentives may be provided at the state and local level. As with federal incentives, these may include tax credits, rebates and more. Some incentives are ongoing, while others are offered for only a limited time. These local incentives could come from your county or municipality, or from the Pennsylvania government.

Next Steps for Installing Solar in West Manchester

Solar incentives might come from your local utlity company, the Pennsylvania government or the federal government. The growing number of solar incentives available has contributed to a large increase in solar energy use in the last 15 years. Reaching out to your local West Manchester solar panel installation expert is a great first step towards getting all the incentives you qualify for when you switch to solar energy.