2025 Solar Incentives Guide for Hampton, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Hampton.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Hampton?
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
Source: https://www.dsireusa.org/
Solar incentives are intended to make renewable energy usage more affordable through financial incentives for those who install solar panels on their homes. The incentives may include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are offered by the federal government, some by the Virginia government and some by your utility company, county or municipality. Some solar incentives you might qualify for are:
- Net Metering: Net metering factors in once your solar panels are up and running. If you have a net metering agreement with your Hampton utility company, it will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in other areas you might receive a refund equivalent to a percentage of the value.
- Solar Renewable Energy Certificate (SREC): In general, solar systems that produce more than a specified (usually small) amount of electricity qualify for SRECs or other performance-based incentives. SRECs and the like are typically given at the state level. You can sell SRECs to your utility company or another buyer, and this is usually considered part of your taxable income.
- Tax Exemptions: Your solar panels might qualify for both sales tax and property tax exemptions. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions allow you to exclude the value added by your solar panels when you are calculating property taxes on your house.
- Rebates: Solar companies may help you claim a rebate, or partial refund of your purchase, for your solar panels. States or counties will also offer limited-time rebates at various times. If you receive a rebate, that amount will usually come off the total price before any tax credits are calculated.
- Tax Credits: Tax credits lower, dollar-for-dollar, how much income tax you owe the federal government. Tax credits differ from tax deductions.
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Federal Solar Incentives
When thinking about solar incentives, you likely think of federal incentives first. 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 specified percentage of the money you spend on your solar system.
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. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum claim amount.
Your local Hampton solar panel installer can offer more information about the ITC and how it may apply to your situation.
The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The new Clean Energy Credit extends until 2035. American homeowners can now apply for a 30% credit for solar systems that began installation on or after January 1, 2022, and will be done by December 31, 2032. The total credit will then decrease annually until the date of expiration. Starting in 2023, the expansion will also make credits for energy storage systems even easier to claim.
Click here to learn more about the new Inflation Reduction Act. The best way to understand how the new Clean Energy Credit will apply to you is to talk with your local Hampton solar panel company.
State & Local Solar Incentives
Some solar incentives may be offered at the local or state level. As with federal incentives, these may include tax credits, rebates and more. Certain incentives are ongoing, while others are offered for only a limited time. Your local incentives might come from the Virginia government, or from your specific county or municipality.
Next Steps for Installing Solar in Hampton
Solar incentives might come from the federal government, the Virginia government or your local utility company. The variety of incentives available has contributed to a large increase in solar energy use in the last 15 years. It is a good idea to talk to your local Hampton solar installation expert to learn more about these incentives and to ensure that you're getting the most money possible for your solar panels.
EcoWatch's Hampton, VA Solar Incentives FAQs
If I already have a solar system installed on my house, can I still claim incentives?
An excellent idea would be to talk to someone from the company that installed your solar panels – or speak to a local Hampton solar installer — to clarify which incentives you might qualify for. If your system was installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
What are some environmental benefits of installing solar panels on my home?
You can lower your carbon footprint by 300 pounds of CO2 annually when you switch to solar panels. This adds up to roughly 6,000 pounds over 20 years. In addition, solar power is a renewable energy source, meaning that switching your home over reduces the drain on our planet's resources.
Can I receive incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can claim both rebates and tax credits towards the cost of your solar panels. Depending on precisely which incentives you are claiming, they may apply in a different order. Make sure that you speak with your solar installer or a local tax professional to verify that you are claiming incentives correctly and getting the most money you can.
Can I use a combination of multiple types of renewable energy to power my home?
You can use multiple types of renewable energy, or a combination of renewable and non-renewable energy, to power your home. Make sure you go over your plan with your local Hampton solar installation expert. They can help you as you plan for your project and also help you understand the various incentives that you might or might not qualify for.
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.