2023 Solar Incentives Guide for Lorton, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Lorton.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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Updated September 15, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Lorton?
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 designed to make renewable energy usage more affordable through financial incentives for individuals who install solar panels on their homes. Solar incentives might include upfront discounts, cash back or monthly credits towards your utility bill. Some incentives are offered by the federal government, some by the state of Virginia and some by your utility company, county or municipality. Categories of solar incentives include:
- Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives may be available to you if your solar system produces more than a specified (typically small) amount of electricity. This category of incentives is normally handled at the state level. You can sell the SRECs you receive to your utility company or other buyers, and the money you make is normally considered part of your taxable income.
- Rebates: Rebates, or cash back after a purchase, are typically applied before any solar tax credits are calculated. Solar rebates can be provided by your local utility company, by your state or by your county.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
- Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you have a net metering agreement with your Lorton utility company, the company will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some places, this is a dollar-for-dollar credit, while in other places you may be refunded a percentage of the value.
- Tax Exemptions: These might come in the form of property tax exemptions, which can let you ignore the value of your solar system when paying taxes on your home. You may also qualify for an exemption on sales tax at the time of purchase.
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Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some familiarity with. A federal incentive many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a predetermined percentage of your solar system's cost.
The ITC applies to solar panels installed on your primary or secondary residence in the United States. The solar panels have to have been installed on a property you own after January 1, 2006 for you to claim the credit. The ITC originally paid out 30% of all system costs (panels, accessories, labor and equipment), although the total amount has fluctuated 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.
To best understand how the ITC could apply to your situation, speak to your local Lorton solar panel installer and request more information.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now dubbed the Clean Energy Credit. The new Clean Energy Credit extends until 2035. You can now apply for a 30% credit for solar systems installed between 2022 and 2032. This credit will then decrease annually until its expiration. Starting in 2023, the program expansion will also make it easier to get credit for energy storage systems.
Click here to learn more about the new Inflation Reduction Act. The best way to fully understand how the new Clean Energy Credit will apply to you is to get in touch with your local Lorton solar panel installation expert.
State & Local Solar Incentives
Some solar incentives may be provided by state and local governments. Similar to federal incentives, these might include rebates, tax credits and more. Some incentives are ongoing, while others might only be available for a limited time. Incentives may be provided by the Virginia government, or by your county or municipality.
Next Steps for Installing Solar in Lorton
Solar incentives can be offered by the Virginia government, the federal government or your local utility company. The growing number of incentives available has facilitated the nationwide growth of solar energy use in the last 15 years. Getting in touch with your local Lorton solar panel installation company is an excellent first step towards making sure you get all the incentives you qualify for when you switch to solar energy.
EcoWatch's Lorton, VA Solar Incentives FAQs
What if I am planning to add a solar system to a rental property, vacation home or commercial property? Do I still qualify for incentives?
While we recommend talking to your local solar installer and/or tax professional to fully understand what solar incentives apply to you, many can be claimed on a second home, provided that it is in the United States and owned by you. There may be additional incentives available for commercial properties specifically, depending on the details.
My home already has solar panels installed. Do I qualify for any incentives?
If your solar system was installed after January 1, 2022, you may qualify for the newly increased 30% tax credit under the Inflation Reduction Act. If you installed your system between 2006 and 2021, you might qualify for a tax credit between 26% and 30%, depending on the date of installation. Speaking with a representative from the company that installed your solar system, or any local Lorton solar installer, can help you learn what incentives you might want to apply for.
How much can I save annually on my electric bill if I install solar panels on my house in Lorton?
Typically, Lorton homeowners who install solar panels save around $898.00 per year, or around $17,062.02 over 20 years after they make the switch.
What are the top solar panel installation companies near me?
To find the best solar panel installers near you, read our article on Lorton's best solar panel companies.
Can I qualify for incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order that incentives will be applied in may vary depending on which incentives you are claiming but generally yes, you can receive multiple types of incentives for your solar project. Get in touch with your solar installer or a local tax professional to ensure you are claiming all of the incentives you qualify for and applying them in the correct order.
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.