2023 Solar Incentives Guide for Hollymead, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Hollymead.
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 Hollymead?
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 designed to mitigate the cost of installing a solar panel system on your home. This category of financial incentives is in place to encourage more people to convert their home partially or fully to renewable energy. You might qualify for several types of incentives, such as discounts, cash back or credit towards your monthly utility bill, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of Virginia and others from the federal government. Some broad categories of solar incentives include:
- Tax Credits: Tax credits decrease, dollar-for-dollar, how much income tax you owe the federal government. Tax credits differ from tax deductions.
- Tax Exemptions: These may come in the form of property tax exemptions, which can let you ignore the value added by your solar panels when paying property tax on your home. You could also look for exemptions on sales tax at the time of purchase.
- Rebates: Solar rebates can be provided by your state or county, or by your local utility company. These rebates work as partial refunds that are applied after you purchase a solar system and before tax credits are calculated.
- Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you've signed a net metering agreement with your Hollymead utility company, they will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some locations, this credit is dollar-for-dollar, while in other areas you may be refunded a percentage of the value.
- Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that typically becomes part of your taxable income. Generally, you must meet a certain (small) threshold of energy production before your solar system can earn SRECs or other performance-based incentives. Incentives like these are normally handled at the state level.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have heard of. The Federal Solar Investment Tax Credit, or ITC, is likely the most commonly known federal solar incentive. The ITC allows you to claim a tax credit for a predetermined percentage of your solar system's cost.
The ITC covers solar systems installed after January 1, 2006 and under this program you can deduct from your taxes a percentage of the total cost of solar panels, labor, accessories and equipment. You can claim this credit for solar panels installed on a primary or secondary residence that you own in the United States. Originally, you could claim 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum claim amount.
Talking to your local Hollymead solar panel installation expert is the best way to understand how the ITC applies to you.
In August 2022, the ITC (now titled the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. Homeowners can now receive a credit of 30% of the total costs of solar system installation for projects started after January 1, 2022 and completed before the end of 2032. The credit percentage will then decrease yearly until the Clean Energy Credit ends in 2035. Starting in 2023, it will also be easier to claim credits for energy storage systems under the new laws.
Click here to learn more about the new Inflation Reduction Act. To best understand how the new Clean Energy Credit might apply to you, get in touch with your local Hollymead solar installation expert.
State & Local Solar Incentives
Some solar incentives are often also provided by state and local governments. As with federal incentives, these may include tax credits, rebates and more. These incentives might be handled by the Virginia government, or by your county or municipality. Certain incentives are ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Hollymead
The nationwide use of solar energy has gone up significantly in the last 15 years, in part due to the proliferation of solar incentives. You may get these incentives from your local utility company, the Virginia government or the federal government. Speak with your local solar panel installer today to learn more and to save the most money possible on solar panels for your Hollymead home.
EcoWatch's Hollymead, 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.