2023 Solar Incentives Guide for Laurel, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Laurel.
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 Laurel?
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 term "solar incentives" covers a range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Incentives might include things like discounts, cash back or credit on your utility bill each month. Some incentives are offered federally, while others are handled by the state of Virginia or your specific utility company, county or municipality. Types of solar incentives might include:
- Net Metering: Don't forget to talk to your Laurel utility company about signing a net metering agreement. This will allow you to get a credit towards your monthly utility bill for the value of excess energy your solar panels generate. You might receive either a dollar-for-dollar credit or a percentage of the value.
- Tax Exemptions: These can come in the form of property tax exemptions, which can let you exclude the value of your solar system when calculating the taxes you pay on your house. You could also look for exemptions on sales tax at the time of purchase.
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
- Rebates: Some solar companies will help you claim a rebate, or partial refund of your purchase, for your solar system. States or counties will also sometimes offer limited-time rebates. Any rebates you receive will usually come off your total price before tax credits are calculated.
- Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for money that typically becomes part of your taxable income. In most cases, a certain (small) threshold of energy production must be met before your solar system qualifies for SRECs or other performance-based incentives. SRECs and similar incentives are generally handled at the state level.
Federal Solar Incentives
When thinking about solar incentives, you likely think of federal incentives first. A federal incentive that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a specific percentage of your solar system's cost.
The ITC applies to the value of a solar system installed on your primary or secondary residence in the United States. The solar panels must have been installed after January 1, 2006 on a property owned by you for you to be eligible for the credit. Originally, the ITC covered 30% of all installation costs (panels, labor, accessories and equipment), although the covered amount has fluctuated slightly over the last few years between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the claim amount.
Wondering how the ITC applies to your specific situation? Get in touch with your local Laurel solar panel installation expert to get more information.
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. The Clean Energy Credit runs until 2035. Any solar installation project that is completed between January 1, 2022 and December 31, 2032 may qualify for a 30% tax credit. The amount will decrease slightly on a yearly basis until the end of the current program. The expansion to the program also makes it easier to get credit for energy storage systems, starting in 2023.
Click here to learn more about the new Inflation Reduction Act. The easiest way to learn more about how the new Clean Energy Credit applies to you is to speak with your local Laurel solar panel installers directly.
State & Local Solar Incentives
Some solar incentives are often also provided at the state and local level. Similar to federal incentives, these could include tax credits, rebates and more. Certain incentives are offered for only a limited time, while others are ongoing. Your local incentives might come from your county or municipality, or from the Virginia government.
Next Steps for Installing Solar in Laurel
You can apply for solar incentives from the federal government and the Virginia government, as well as from your local utility company. Growing availability of solar initiatives in the past 15 years has helped increase solar adoption nationwide. Your local Laurel solar panel installer can help you learn more about which incentives you can apply for, and get you started on the path to switching to renewable energy today.
EcoWatch's Laurel, 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.