2024 Solar Incentives Guide for South Houston, TX - Tax Credits & Rebates

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

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

Solar incentives help mitigate the cost of installing a solar panel system on your home. Financial incentives like these are in place to encourage more people to convert their home partially or fully to renewable energy. Various types of incentives, such as discounts, cash back or monthly utility bill credits, might be available to you. Some incentives may be handled by the Texas government, by your utility company or by county or municipality, while others are federal. Types of solar incentives might include:

• Tax Exemptions: Your solar system might 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 added value of the solar panels when you are calculating property taxes on your home.
• Net Metering: Net metering factors in once your solar panels are up and running. If you have a net metering agreement with your South Houston utility company, it 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 other areas you may get refunded a percentage of the value.
• Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the federal government. (This is different from a tax deduction.)
• Rebates: Rebates, or cash back after a purchase, are typically given prior to any solar tax credits being calculated. Rebates can be given by your local utility company, by your county or by your state.

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Federal Solar Incentives

When you hear the term "solar incentives," federal incentives might be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is the most commonly known federal solar incentive. The ITC provides a tax credit for a set percentage of the cost of your solar system.

The ITC applies to solar panels installed on your primary or secondary residence in the United States. The solar panels must have been installed after January 1, 2006, on a property owned by you for you to be eligible for the credit. Initially, the ITC applied to 30% of all system installation costs (panels, labor, accessories and equipment), although the covered amount has fluctuated slightly over time between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the amount you can claim.

Reaching out to your local South Houston solar panel installer is the best way to understand how the ITC may apply to you.

The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). For solar systems installed between January 1, 2022, and December 31, 2032, homeowners may be eligible for a credit equal to 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit ends in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. Your local South Houston solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it may apply to you.

State & Local Solar Incentives

Rebates, tax credits and more might be provided at multiple levels. Along with federal solar incentives, there are often state and local ones, too. Certain incentives are offered for only a limited time, while others are ongoing. Your local incentives may come from your county or municipality, or from the Texas government.

Next Steps for Installing Solar in South Houston

You can receive solar incentives from the Texas government and the federal government, as well as from your local utility company. Growing availability of solar initiatives over the last 15 years has helped increase solar adoption nationwide. Contact your local solar panel installer today to find out more information and to save the most money possible on solar panels for your South Houston home.