2025 Solar Incentives Guide for Palestine, TX - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Palestine.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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What Solar Tax Credits, Incentives, and Rebates are Available in Palestine?
Renewable Energy Systems Property Tax Exemption
Texas Gas Service - Residential Energy Efficiency Rebate Program
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
Source: https://www.dsireusa.org/
Solar incentives help mitigate the cost of installing solar panels on your home. These financial incentives are in place to encourage more Americans to switch to renewable energy. These incentives could include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are handled by the federal government, some by the Texas government and some by your specific utility company, county or municipality. Types of solar incentives might include:
- Tax Exemptions: Sales tax exemptions are applied at the time of purchase for your solar panels. Property tax exemptions let you exclude the value that your solar panels add when you're calculating the amount of property tax you need to pay on your home.
- Rebates: Rebates, or cash back after a purchase, are normally given before any solar tax credits are calculated. Rebates can be offered by your local utility company, by your state or by your county.
- Net Metering: You may be able to sign a net metering agreement with your Palestine utility company that will apply to all or a percentage of the excess electricity that is generated by your solar panels. Your utility company will then deduct this value from your utility bill each month.
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the government.
Federal Solar Incentives
Federal solar incentives are probably the first thing that you think of when thinking about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is the most well-known federal solar incentive. The ITC provides a tax credit for a predetermined percentage of the cost of your solar system.
The ITC can be applied to a solar system installed on your primary or secondary residence in the United States. The solar system has to have been installed on a property you own after January 1, 2006, for you to be eligible for the credit. The ITC originally paid out 30% of all system costs (panels, labor, equipment and accessories), although the total amount has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the amount you can claim.
Your local Palestine solar panel installation expert can give you more information about the ITC and how it may apply to your situation.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now called the Clean Energy Credit. The Clean Energy Credit runs until 2035. Solar installation projects started after January 1, 2022, and completed by the end of 2032 may qualify for a 30% tax credit; this amount will then decrease slightly each year until the end of the current program. Beginning in 2023, it will also be easier to qualify for credits for energy storage systems with the new act.
More information about the new Inflation Reduction Act can be found here. Your local Palestine solar panel installation experts can answer your questions and explain how the new Clean Energy Credit may apply to you.
State & Local Solar Incentives
In addition to federal solar incentives, there are often also state ones. Rebates, tax credits and more might be available at a more local level. Certain incentives are ongoing, while others may only be available for a limited time. They might be offered by your county or municipality, or by the Texas government.
Next Steps for Installing Solar in Palestine
There are a number of different solar incentives: those provided by local utility companies, those provided by the Texas government and those provided by the federal government, to name a few. The use of solar energy has increased enormously in the last 15 years, thanks to these incentives. Reaching out to your local Palestine solar panel installation company is the best first step towards getting all the incentives you qualify for when you switch to solar energy.
EcoWatch's Palestine, TX Solar Incentives FAQs
How much will a solar system save me annually on my electric bill in Palestine?
Generally, Palestine homeowners who install solar panels save around $1,039.50 per year, or about $19,750.46 over 20 years after they make the switch.
What are some of the environmental benefits of switching to solar?
You can lower your carbon footprint by 400 pounds of CO2 annually when you install solar panels. This adds up to around 8,000 pounds in 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.
How long until the federal solar tax credit ends?
The federal solar tax credit, formerly called the ITC and now named the Clean Energy Credit, is slated to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
Can I claim incentives both towards the initial cost of solar panels, and later as reimbursement?
The order your incentives will be applied in could vary depending on which incentives you are eligible for but in most cases yes, you can claim multiple types of incentives for your solar project. Talk with your solar installer or a local tax professional to make sure you are claiming all the incentives you qualify for and applying them in the correct order.
Can I use solar and another type of renewable energy in combination to power my home?
Yes, you can utilize multiple types of renewable energy to power your home — for example, a combination of solar and geothermal. You can also use both renewable energy sources and a non-renewable backup source of energy. Be sure to discuss your proposed plan with your local Palestine solar panel installer, to make sure you know what you'll need and what kinds of incentives you will or won't qualify for.
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