2023 Solar Incentives Guide for Arlington, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Arlington.
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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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
Why you can trust EcoWatch
What Solar Tax Credits, Incentives, and Rebates are Available in Arlington?
Income Tax Deduction for Energy-Efficient Products
Local Option- Renewable Energy Machinery and Tools Property Tax Exemption
Local Option - Residential Property Tax Exemption for Solar
Arlington County - Green Building Incentive Program
Federal Residential Renewable Energy Tax Credit
Solar incentives are designed to encourage people to switch their home over to renewable energy by providing incentives meant to lower the financial burden of solar panel installation and use. Solar incentives can include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are offered by the federal government, some by the Virginia government and some by your utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are generally handled at the state level. Once your solar panel system meets a predetermined threshold (usually a small amount of energy production), you are eligible to receive SRECs that can then be sold to your utility company or other buyers. The money you make from the sale is usually considered part of your taxable income.
- Rebates: A rebate is a partial refund after the purchase of your solar system. Rebates might be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
- Net Metering: Net metering becomes relevant after your solar system is up and running. If you've signed a net metering agreement with your Arlington 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 credit is dollar-for-dollar, while in other areas you might receive a refund equivalent to a percentage of the value.
- Tax Exemptions: These might come in the form of property tax exemptions, which allow you to ignore the value added by your solar panels when calculating the taxes you pay on your home. They may also include exemptions on sales tax at the time of purchase.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some knowledge of. 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 percentage of the cost of your solar system.
The ITC originally covered 30% of the total cost of installing a solar system, although that number has fluctuated slightly over time between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total cost of installation includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum claim amount. The ITC can be applied to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.
Talking to your local Arlington solar panel installer is the best way to understand how the ITC applies 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). Homeowners can now receive a credit of 30% of the total solar system installation costs for projects that began after January 1, 2022 and will be finished by the end of 2032. The credit percentage will then decrease on a yearly basis until the Clean Energy Credit expires 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. To understand how the new Clean Energy Credit might apply to you, talk to your local Arlington solar installers.
State & Local Solar Incentives
Not all solar incentives are federal; tax credits, rebates and more are often offered at the local or state level. These incentives may be given out by your county or municipality, or by the Virginia government. Some are ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Arlington
You can qualify for solar incentives from the federal government and the Virginia government, as well as from your local utility company. The increased availability of solar initiatives over the last 15 years has helped greatly increase nationwide adoption of solar energy. Speak with your local solar panel installation company today to learn more and to save the most money possible on a solar system for your Arlington home.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries
Best Warranty Coverage
- Industry-leading warranty coverage
- Expansive service area
- Some reported communication issues
- No leases or PPAs
EcoWatch's Arlington, VA Solar Incentives FAQs
What if I want to add solar panels to a rental property, vacation home or commercial property? Will I still qualify for incentives?
Many solar incentives are intended to apply to a property you own that is located within the United States; most secondary residences will fall under this distinction. Other solar incentives may be available for commercial properties, depending on the details. We recommend speaking with your local solar installer and/or tax professional to better understand what incentives may apply to your specific situation.
How can I find out if I qualify for certain solar incentives?
It's a smart idea to get in touch with your local Arlington solar installer for a better understanding of which incentives your project will qualify for. Usually, 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, such as those provided by the Virginia government, might have additional requirements.
What are some of the environmental benefits of switching to solar energy?
Solar energy is renewable — by switching where you get your energy, you can help reduce the strain on our planet's resources. You can also lower the CO2 emissions from your home by 300 pounds yearly, or around 6,000 pounds over 20 years.
If I trade in my appliances for ones that can utilize solar energy, are there any incentives I can claim?
The recently passed Inflation Reduction Act introduces multiple incentives designed to reward homeowners who make 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 receive incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order in which incentives are applied might vary depending on which incentives you are eligible for but generally yes, you can receive multiple types of incentives for your solar project. Talk with your solar installer or a local tax professional to be sure 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.