2023 Solar Incentives Guide for Mcallen, TX - Tax Credits & Rebates

In this guide, we'll cover the latest solar incentives and rebates available in Mcallen.

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.
Get a free quote from one of our trusted Mcallen solar installers to see how much you can save.

By EcoWatch Local Advisors

Data Analysis: James Savino

Ranking Methodology: Karsten Neumeister

Updated January 20, 2023

Why you can trust EcoWatch

We work with a panel of solar experts to create unbiased reviews that empower you to make the right choice for your home. No other site has covered renewables as long as us, which means we have more data and insider information than other sites. Our rankings are never affected by revenue or partnerships.

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

Renewable Energy Systems Property Tax Exemption

Incentive Type:
Property Tax Incentive

Texas Gas Service - Residential Energy Efficiency Rebate Program

Incentive Type:
Rebate Program
Free Equipment Program: Free appliance installation and weatherization services
Home Improvement (includes attic insulation, duct sealing, duct insulation, duct replacement, high-efficiency gas furnace, and Wi-Fi thermostat: Up to $1000
Solar Water Heater With Natural Gas Backup: $750
Tankless or Super High-efficiency Water Heater: $650
Furnace: $675
Furnace Tune-Up: $40
Natural Gas Dryer with moisture sensor: $225
Natural Gas Dryer Stub: $300

Federal Residential Renewable Energy Tax Credit

Incentive Type:
Personal Tax Credit
30% federal tax credit for systems placed in service after 12/31/2021 and before 01/01/2033. Good for: solar water heat, solar photovoltaics, biomass, geothermal heat pumps, wind (small), fuel cells using renewable fuels.

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


Solar incentives are intended to make renewable energy usage more affordable via financial incentives for those who install solar panels on their homes. Incentives can include things like discounts, cash back or credit on your utility bill each month. Some incentives are handled federally, while others are offered by the state of Texas or your specific utility company, county or municipality. Some solar incentives you might qualify for are:

  • Tax Exemptions: Tax exemptions can come in one of two forms. First, there is sales tax exemption, which is applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to exclude the value added by your solar system when calculating property tax for your house.
  • Tax Credits: Tax credits lower, dollar-for-dollar, how much income tax you owe the government. These differ from tax deductions.
  • Net Metering: Net metering is an incentive you can get after your solar system is up and running. If you've signed a net metering agreement with your Mcallen utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in other places you might make back a percentage of the value.
  • Rebates: Solar rebates might be provided by your county or state, or by your local utility company. These rebates work as partial refunds that are applied after you pay for a solar system and before tax credits are calculated.

Federal Solar Incentives

When people think of solar incentives, federal incentives are likely the first thing that comes to mind. 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 can be applied to solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, labor, accessories and equipment. This credit can be claimed on a solar panel system installed on a primary or secondary residence that you own in the United States. 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 claim amount.

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

The ITC was renewed and increased in scope after 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. You can now receive a 30% credit for solar systems installed between 2022 and 2032. This new credit will then see a slight annual decrease until its expiration. The expansion to the program also makes it easier to get credit for energy storage systems, starting in 2023.

More information about the new Inflation Reduction Act can be found here. Your local Mcallen solar panel company is the best resource for answering your questions about the new Clean Energy Credit and how it applies to you.

State & Local Solar Incentives

Rebates, tax credits and more can be provided at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. Certain incentives are ongoing, while others are only available for a limited time. Incentives may be provided by your county or municipality, or by the Texas government.

Next Steps for Installing Solar in Mcallen

There are many kinds of solar incentives: those given by local utility companies, those given by the Texas government and those given by the federal government, to name a few. The use of solar energy has grown enormously in the last 15 years, partially due to these incentives. We suggest talking to your local Mcallen solar installation expert to learn more about these incentives and to ensure that you're getting the largest number possible for your solar panels.

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EcoWatch's Mcallen, TX Solar Incentives FAQs

How do I know if I qualify for specific solar incentives?

It's a smart idea to get in touch with your local Mcallen solar installer for a better understanding of which incentives your project may qualify for. Generally, solar incentives apply to new solar panel systems installed on property you own (in the U.S.) between the dates specified by the incentive. Some incentives, like those provided by the Texas government, may have additional requirements.

My home already has solar panels. Are there any incentives that I qualify for?

You should plan to talk to the company that installed your system — or speak to a local Mcallen solar installer — to clarify which incentives you might qualify for. If your system was installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.

What are the environmental benefits of switching to solar energy?

You can decrease your carbon footprint by 450 pounds of CO2 a year by switching to solar panels. This adds up to roughly 9,000 pounds over 20 years. In addition, solar power is a renewable energy source, meaning that switching your home over lessens the drain on our planet's resources.

Can I receive incentives both towards the initial cost of solar panels, and later as reimbursement?

The order in which incentives are applied could vary depending on which incentives you receive but usually yes, you can claim multiple types of incentives for your solar project. Talk with your solar installer or a local tax professional to verify you are claiming all the incentives you are eligible for 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.

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