2025 Solar Incentives Guide for Herndon, VA - Tax Credits & Rebates

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

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

Solar incentives are intended to encourage homeowners to switch their home over to renewable energy by providing incentives meant to lower the financial burden of solar panel installation and use. You might be eligible for several types of incentives, such as cash back, discounts or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of Virginia and others from the federal government. Categories of solar incentives include:

• Tax Exemptions: Your solar system may 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 ignore the value added by your solar panels when you are calculating property taxes on your home.
• Solar Renewable Energy Certificate (SREC): SRECs can be sold to your utility company (or other buyers) for cash that normally counts as part of your taxable income. In most cases, there is a small threshold of energy production to meet before your solar system is eligible for SRECs or similar performance-based incentives. These kinds of incentives are generally handled by your state government.
• Rebates: A rebate is a partial refund given after you've purchased your solar panels. Rebates might be offered by your local utility company, your county or your state. The rebates are usually applied before tax credits are calculated.
• Tax Credits: Tax credits decrease, dollar-for-dollar, how much income tax you owe the government. Tax credits differ from tax deductions.
• Net Metering: Don't forget to speak to your Herndon utility company about signing a net metering contract. This allows you to get a credit towards your monthly utility bill for the value of excess energy your solar panels generate. You could receive either a dollar-for-dollar credit or a percentage of the value.

Federal Solar Incentives

Federal solar incentives are likely to be the first thing that comes to mind when you think about solar incentives. A federal incentive that most people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a specific percentage of the cost of your solar system.

The ITC applies to solar panels installed after January 1, 2006, on a primary or secondary residence that you own in the United States. The credit initially covered 30% of the total cost – for panels, labor, equipment and accessories – although it may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the amount you can claim.

To better understand exactly how much the ITC could save you, speak with your local Herndon solar panel installation expert.

The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. 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 equal to 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit ends in 2035. Starting in 2023, the expansion to the program will also make claiming credit for energy storage systems easier than ever before.

More information about the new Inflation Reduction Act can be found here. Your local Herndon solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it may apply to you.

State & Local Solar Incentives

Some solar incentives are often also provided by state and local governments. As with federal incentives, these could include tax credits, rebates and more. These incentives — which might be provided by the state of Virginia, or by your county or municipality — might be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Herndon

Solar incentives can be provided by the Virginia government, the federal government or your local utility company. The large number of solar incentives available has facilitated the nationwide growth of solar energy use in the last 15 years. Reaching out to your local Herndon solar panel installation company is the best first step towards getting the most money possible when you switch to solar energy.