2025 Solar Incentives Guide for Collegedale, TN - Tax Credits & Rebates

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

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

Solar incentives are meant to encourage homeowners to switch to renewable energy by providing financial incentives meant to lower the burden of solar panel installation and use. Incentives can include things like discounts, cash back or monthly utility bill credits. Some incentives are offered by the federal government, while others are offered by the state of Tennessee or your utility company, county or municipality. Some broad categories of solar incentives include:

• Tax Exemptions: These can come in the form of property tax exemptions, which allow you to ignore the value added by your solar panels when calculating the taxes you pay on your house. You may also qualify for an exemption on sales tax at the time of purchase.
• Rebates: A solar rebate is a partial refund credited to your account after you've paid for 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.
• Net Metering: You may be able to sign a net metering agreement with your Collegedale utility company that will apply to all or a percentage of the excess electricity your solar panels generate. They will then subtract this value from your monthly utility bill.
• Tax Credits: Tax credits reduce, dollar-for-dollar, the amount of income tax you owe the federal government. These differ from tax deductions.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some familiarity with. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC allows you to claim a tax credit for a specific percentage of your solar system's cost.

The ITC covers solar systems installed after January 1, 2006, and lets you deduct from your taxes a percentage of the total cost of solar panels, accessories, labor and equipment. This credit can be claimed on solar panels installed on a primary or secondary residence that you own in the United States. Originally, you could claim 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum amount you can claim.

Your local Collegedale solar panel installer can provide you with more information about the ITC and how it may apply to your situation.

The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as renaming it to the Clean Energy Credit). The new Clean Energy Credit now runs until 2035. Homeowners are now eligible for a 30% credit for solar systems that began installation after January 1, 2022, and are completed by the end of 2032. This credit will then decrease annually until the date of expiration. Starting in 2023, it will also be easier to qualify for credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. To better understand how the new Clean Energy Credit applies to you, reach out to your local Collegedale solar installation company.

State & Local Solar Incentives

Rebates, tax credits and more might be provided at multiple levels. On top of federal solar incentives, there are often state and local ones as well. These incentives may be given out by the Tennessee government, or by your county or municipality. Some are ongoing, while others are available for a limited time.

Next Steps for Installing Solar in Collegedale

Nationwide solar energy use has gone up tremendously in the last 15 years, in part due to the growth in the number of solar incentives. You might receive these incentives from the federal government, the Tennessee government or your local utility company. Call your local solar panel installation company today to find out more information and to save the most money possible on a solar system for your Collegedale home.