2023 Solar Incentives Guide for Glen Allen, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Glen Allen.
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 Glen Allen?
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
Solar incentives are intended to encourage homeowners to switch to renewable energy by offering incentives meant to lower the financial burden of solar panel installation and use. The incentives may 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. Categories of solar incentives include:
- Net Metering: You may be able to sign a net metering contract with your Glen Allen utility company, that may apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then deduct this value from your utility bill each month.
- Rebates: A rebate is a partial refund credited to your account after you've paid for your solar system. Rebates may be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.
- Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives may be available to you if the solar system on your home produces over a specified (typically small) amount of electricity. This category of incentives is usually handled by the state government. You can sell the SRECs you receive to your utility company or other buyers, and the money you receive in return is normally considered part of your taxable income.
- Tax Credits: Tax credits reduce, dollar-for-dollar, the amount of income tax you owe the federal government. These are different from tax deductions.
- 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. This allows you to ignore the value added by your solar system when paying property tax on your home.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some knowledge of. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a certain percentage of the money you spend on your solar system.
The ITC applies to the total cost of solar panel installation, including the panels themselves as well as labor, equipment and accessories. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence that you own, as long as it is located in the United States. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum claim amount.
Your local Glen Allen solar panel installation expert can give you more information about the ITC and how it may apply to your situation.
In August 2022, the ITC (now titled the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners may be eligible for a credit for 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit expires in 2035. Starting in 2023, it will also be easier to get credits for energy storage systems under the new laws.
More information about the new Inflation Reduction Act can be found here. The best way to fully understand how the new Clean Energy Credit will apply to you is to reach out to your local Glen Allen solar panel installation expert with your questions.
State & Local Solar Incentives
Some solar incentives are often also provided at the state and local level. Similar to federal incentives, these can include rebates, tax credits and more. Some incentives are ongoing, while others are only available for a limited time. These incentives might be given by the Virginia government, or by your county or municipality.
Next Steps for Installing Solar in Glen Allen
Solar energy use nationwide has increased enormously in the last 15 years, in part thanks to the proliferation of solar incentives. You can obtain these incentives from the Virginia government, the federal government or your local utility company. We suggest talking to your local Glen Allen solar installation expert for more information about these incentives and to make sure that you're getting all of the money you can for your solar panels.
EcoWatch's Glen Allen, VA Solar Incentives FAQs
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