2025 Solar Incentives Guide for Little Elm, TX - Tax Credits & Rebates

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

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

The term "solar incentives" refers to financial incentives that are in place to encourage the adoption and use renewable energy by making solar panels more affordable. Incentives could include things like discounts, cash back or monthly utility bill credits. Some incentives are handled federally, while others are offered by the Texas government or by your specific utility company, county or municipality. Categories of solar incentives include:

• Net Metering: Be sure to talk to your Little Elm utility company about signing a net metering contract. This will allow you to receive credit towards your utility bill every month for the value of excess energy your solar panels generate. You could receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the government.
• Tax Exemptions: Your solar panels could qualify for both sales tax and property tax exemptions. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to ignore the value added by your solar panels when you are calculating property taxes on your house.
• Rebates: Rebates, or partial refunds after a purchase, are usually given prior to any solar tax credits being calculated. These rebates can be given by your local utility company, by your state or by your county.

Federal Solar Incentives

When you hear the term "solar incentives," federal incentives are likely the first thing that comes to mind. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a certain percentage of the cost of your solar system.

The ITC applies to the total cost of installing solar panels, including the panels themselves as well as equipment, labor and accessories. This credit can be claimed for panels installed after January 1, 2006, on a primary or secondary residence that you own, as long as it is located in the United States. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum claim amount.

Talking to your local Little Elm solar panel installation expert is the best way to understand how the ITC could apply to you.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now referred to as the Clean Energy Credit. Now, solar installation projects begun after January 1, 2022, and finished by December 31, 2032, might qualify for a 30% tax credit. The amount of the credit will then decrease slightly each year until the current Clean Energy Credit expires in 2035. Starting in 2023, the expansion will also make credits for energy storage systems even easier to claim.

Click here to learn more about the new Inflation Reduction Act. Your local Little Elm solar panel company can answer any questions you have and explain how the new Clean Energy Credit may apply to you.

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. Some incentives are offered for only a limited time, while others are ongoing. These local incentives may come from your county or municipality, or from the Texas government.

Next Steps for Installing Solar in Little Elm

There are many kinds of solar incentives: those given by the federal government, those given by the Texas government and those provided by local utility companies, to name a few. The use of solar energy has grown tremendously in the last 15 years, partially due to these incentives. When you're prepared to make the switch to solar energy, calling your local Little Elm solar panel installation expert is a great first step.