2023 Solar Incentives Guide for Front Royal, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Front Royal.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Front Royal?
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
Federal Residential Renewable Energy Tax Credit
The phrase "solar incentives" covers a wide range of financial incentives put in place to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Incentives can include things like discounts, cash back or monthly utility bill credits. Some incentives are handled federally, while others are provided by the Virginia government or your specific utility company, county or municipality. Some solar incentives you might qualify for are:
- Rebates: Solar rebates may be offered by your county or state, or by your local utility company. These rebates are essentially partial refunds that are applied after you pay for a solar system and before tax credits are calculated.
- Tax Exemptions: Tax exemptions can come in one of two forms. The first 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 home.
- Tax Credits: Tax credits reduce, dollar-for-dollar, the amount of income tax you owe the government. Tax credits differ from tax deductions.
- Net Metering: Net metering is an incentive you can get once your solar panels are up and running. If you have a net metering agreement with your Front Royal 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 credit is dollar-for-dollar, while in other places you may make back a percentage of the value.
- Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce over a specific (normally small) amount of electricity will qualify for SRECs or other performance-based incentives. SRECs and performance-based incentives in general are typically offered by your state government. SRECs can be sold to your utility company or another buyer, and generally the money you make is normally considered part of your taxable income.
Federal Solar Incentives
Federal solar incentives are likely the first thing that you think of when you think about solar incentives. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit that reduces your taxes by a predetermined percentage of the money you spend on solar panels for your home.
The ITC applies to the total cost of solar system installation, including the panels themselves as well as accessories, labor and equipment. You can claim this credit for panels installed after January 1, 2006 on a primary or secondary residence that you own and that is located in the United States. The tax credit ranges from 26-30% of total costs depending on when your project was completed. There is no maximum claim amount.
To more fully understand how the ITC could apply to you, contact your local Front Royal solar panel installer and request more information.
The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as renaming it to the Clean Energy Credit). The new Clean Energy Credit extends until 2035. You are now eligible for a 30% credit for solar systems installed between January 1, 2022 and December 31, 2032. This credit will then decrease annually until it expires. Starting in 2023, the expansion to the program will also make credits for energy storage systems even easier to claim.
More information about the new Inflation Reduction Act can be found here. Your local Front Royal 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; rebates, tax credits and more may be offered at the local or state level. Some incentives are ongoing, while others are offered for only a limited time. Your local incentives could come from the Virginia government, or from your specific county or municipality.
Next Steps for Installing Solar in Front Royal
The variety of available solar incentives has enormously increased the nationwide adoption of solar energy over the past 15 years. You may receive solar incentives from your local utility company, the Virginia government or the federal government. Speak with your local solar panel installation company today to discover more about the various programs and to save the most money possible on a solar system for your Front Royal home.
EcoWatch's Front Royal, VA Solar Incentives FAQs
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.