2024 Solar Incentives Guide for Farragut, TN - Tax Credits & Rebates

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

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The phrase "solar incentives" refers to financial incentives put in place by solar companies and the government to encourage people to use renewable energy by making the installation and use of solar panels more affordable. These incentives could include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are provided by the federal government, some by the state of Tennessee and some by your specific utility company, county or municipality. Types of solar incentives might include:

• Tax Exemptions: These can come in the form of property tax exemptions, which let you ignore the value added by your solar panels when paying property tax on your house. You may also qualify for an exemption on sales tax at the time of purchase.
• Net Metering: Net metering factors in once your solar system is up and running. If you have a net metering agreement with your Farragut utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this is a dollar-for-dollar credit, while in others you might be refunded a percentage of the value.
• Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
• Rebates: Rebates, or partial refunds after a purchase, are normally applied before any solar tax credits are calculated. Solar rebates might be given by your local utility company, by your county or by your state.

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Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have heard of. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a specified percentage of the cost of your solar system.

The ITC applies to solar systems installed after January 1, 2006, on a primary or secondary residence that you own in the United States. The credit initially covered 30% of the total cost – for panels, accessories, equipment and labor – although that amount may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the claim amount.

Curious how the ITC might apply to your specific situation? Contact your local Farragut solar panel installation expert to get more information.

In August 2022, the Inflation Reduction Act expanded and extended the ITC, now dubbed the Clean Energy Credit. The Clean Energy Credit is valid until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit; the amount will be decreased slightly on a yearly basis until the end of the current program. Starting in 2023, it will also be easier to get credits for energy storage systems under this new program.

More information about the new Inflation Reduction Act can be found here. Your local Farragut solar panel installation experts can answer any questions you have and explain how the new Clean Energy Credit will apply to you.

State & Local Solar Incentives

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

Next Steps for Installing Solar in Farragut

Nationwide solar energy use has significantly increased in the past 15 years, in part due to the increase in availability of solar incentives. You may get these incentives from the federal government, the Tennessee government or your local utility company. When you're ready to make the switch to solar energy, calling your local Farragut solar panel installation expert is a great first step.