2023 Solar Incentives Guide for Mount Carmel, TN - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Mount Carmel.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Mount Carmel?
Green Energy Property Tax Assessment
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are intended to encourage people to switch their home over to renewable energy by offering incentives meant to lower the financial burden of solar panel installation and use. Different kinds of incentives, including cash back, discounts or credit towards your monthly utility bill, might be available to you. Certain incentives may be handled by the Tennessee government, by your utility company or by county or municipality, while others are federal. Categories of solar incentives include:
- Tax Exemptions: These can come in the form of property tax exemptions, which allow you to exclude the value of your solar system when paying property tax on your home. They may also include exemptions on sales tax at the time of purchase.
- Net Metering: Net metering is an incentive you can get after your solar system is up and running. If you have in place a net metering agreement with your Mount Carmel utility company, the company will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some areas, this is a dollar-for-dollar credit, while in other places you might receive a refund equivalent to a percentage of the value.
- Rebates: A rebate is a partial refund given after you've purchased your solar panels. These could be offered by your local utility company, your state or your county. The cash back that you get from the rebates is normally applied before tax credits are calculated.
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
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 probably the best-known federal solar incentive. The ITC provides you with a tax credit for a predetermined percentage of your solar system's cost.
The ITC originally covered 30% of the total cost of solar panel installation, although that number has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total installation cost includes the panels themselves as well as the cost of accessories, equipment and labor. There is no maximum claim amount. The ITC applies to solar panels installed after January 1, 2006 on your primary or secondary residence. The residence must be owned by you and in the United States.
Reaching out to your local Mount Carmel solar panel installation expert is the best way to understand how the ITC could apply to your situation.
In August 2022, the ITC (now called the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. The Clean Energy Credit runs until 2035. Any solar installation project that is completed between January 1, 2022 and December 31, 2032 may qualify for a 30% tax credit. This amount will decrease slightly each year until the current program ends. The expansion also makes credits for energy storage systems even easier to claim, beginning in 2023.
More information about the new Inflation Reduction Act can be found here. To better understand how the new Clean Energy Credit might apply to you, get in touch with your local Mount Carmel solar installers.
State & Local Solar Incentives
Not all solar incentives are federal; tax credits, rebates and more may be offered at the state and local level. Certain incentives are ongoing, while others are offered for only a limited time. Your local solar incentives could come from the Tennessee government, or from your specific county or municipality.
Next Steps for Installing Solar in Mount Carmel
Solar incentives can come from your local utility company, the federal government or the Tennessee government. The variety of incentives available has helped nationwide use of solar energy increase greatly in the last 15 years. Speaking with your local Mount Carmel solar panel installer is an excellent first step towards getting all the incentives you qualify for when you switch to solar energy.
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EcoWatch's Mount Carmel, TN Solar Incentives FAQs
What if I add solar panels to a vacation home, rental property or commercial property? Can I still qualify for incentives?
While we recommend getting in touch with your local solar installer and/or tax professional to better understand what solar incentives apply to you, many incentives can be claimed on a second home, so long as that home is in the United States and owned by you. There may be other incentives available specifically for commercial properties, depending on the details.
How much will a solar system save me annually on my electric bill in Mount Carmel?
After adding solar panels to your home in Mount Carmel, you can expect to save about $789.37 per year, or about $14,998.10 over 20 years.
What are the environmental benefits of switching to solar energy?
Solar energy is a renewable energy source — by changing where you get your energy, you can help lessen the strain on our planet's resources. You can also reduce your home's CO2 emissions by 400 pounds annually, or around 8,000 pounds over 20 years.
I want to change out my appliances for ones that are more energy-efficient. Are there any incentives I can claim?
The recently passed Inflation Reduction Act provides several incentives that reward homeowners for making eco-friendly upgrades. Some of these incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.
Can I apply for incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order in which incentives are applied may vary depending on which incentives you are eligible for but usually yes, you can claim multiple types of incentives for your solar project. Speak to your solar installer or a local tax professional to verify you are claiming all possible incentives and applying them in the correct order.
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.