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

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

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

Solar incentives are meant to encourage people to switch to renewable energy by providing financial incentives that lower the burden of solar panel installation and use. Incentives might include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered by the federal government, while others are handled by the Virginia government or by your utility company, county or municipality. Some solar incentives you might qualify for are:

• Tax Exemptions: Sales tax exemptions are applied at the time of purchase for your solar panels. Property tax exemptions let you ignore the value added by your solar system when calculating how much property tax you need to pay.
• Net Metering: Don't forget to speak with your Lorton utility company about signing a net metering agreement. This will allow you to receive credit towards your utility bill every month 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.
• Rebates: Solar companies may help you claim a rebate, or partial refund of your purchase, for your solar panels. States or counties will also sometimes offer limited-time rebates. Any rebates you receive will usually be deducted from the total price before any 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. Typically, a certain (small) threshold of energy production must be met before your solar system can earn SRECs or other performance-based incentives. These kinds of incentives are normally handled by your state government.
• Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some knowledge of. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a predetermined percentage of your solar system's cost.

The ITC can be applied to solar systems installed after January 1, 2006, and allows you to deduct from your taxes a percentage of the total cost of solar panels, equipment, accessories and labor. This credit can apply towards 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 certain projects may qualify for only 26%, depending on the details. There is no maximum claim amount.

Reaching out to your local Lorton solar panel installation expert is the best way to learn more about how the ITC applies to your situation.

The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). The Clean Energy Credit runs until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit. This amount will then decrease slightly on a yearly basis until the end of the current program. Beginning in 2023, it will also be easier to get credits for energy storage systems under the new laws.

More information about the new Inflation Reduction Act can be found here. Your local Lorton solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it will apply to you.

State & Local Solar Incentives

Rebates, tax credits and more can be claimed at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. These incentives might be given out by your county or municipality, or by the Virginia government. Some are available for a limited time, while others are ongoing.

Next Steps for Installing Solar in Lorton

You can apply for and receive solar incentives from the federal government and the Virginia government, as well as from your local utility company. The growing availability of solar initiatives over the last 15 years has helped increase solar adoption nationwide. We suggest talking to your local Lorton solar installation company to learn more about these incentives and to make sure that you're getting the largest number possible for your solar system.