2023 Solar Incentives Guide for Manassas, VA - Tax Credits & Rebates

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

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

Solar incentives are intended to make renewable energy usage more affordable via financial incentives for individuals who install solar panels on their homes. The incentives can include upfront discounts, cash back or monthly credits towards your utility bill. Some incentives are given by the federal government, some by the state of Virginia and some by your specific utility company, county or municipality. Categories of solar incentives include:

• Tax Credits: Tax credits decrease, dollar-for-dollar, how much income tax you owe the government. These differ from tax deductions.
• Rebates: A solar rebate is a partial refund after the purchase of your solar panels. Rebates may be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
• Tax Exemptions: Sales tax exemptions are applied at the time of purchase for your solar system. Property tax exemptions let you ignore the added value of your solar system when you calculate the amount of property tax you need to pay.
• Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for money that normally counts as part of your taxable income. Typically, you must meet a certain (small) threshold of energy production before your solar system can earn SRECs or similar performance-based incentives. SRECs and similar incentives are typically handled by your state government.
• Net Metering: Net metering factors in once your solar system is up and running. If you have in place a net metering agreement with your Manassas utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some locations, this is a dollar-for-dollar credit, while in other places you might make back a percentage of the value.

Federal Solar Incentives

Federal solar incentives are likely the first thing that you think of when you think about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC offers a tax credit for a predetermined percentage of your solar system's cost.

The ITC applies to the total cost of solar system installation, including the panels themselves as well as accessories, labor and equipment. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence that you own and that is located in the United States. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum claim amount.

To know exactly how much money the ITC could save you, contact your local Manassas solar panel installation expert.

In August 2022, the ITC (now referred to as the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. Homeowners are now eligible for a credit equal to 30% of the total costs of solar system installation for projects that began after January 1, 2022 and will be finished by the end of 2032. This percentage will then begin to decrease on a yearly basis until the Clean Energy Credit ends in 2035. Beginning in 2023, it will also be easier to obtain credits for energy storage systems under the new laws.

More information about the new Inflation Reduction Act can be found here. To best understand how the new Clean Energy Credit might apply to you, get in touch with your local Manassas solar installers.

State & Local Solar Incentives

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

Next Steps for Installing Solar in Manassas

The large number of solar incentives available has helped tremendously increase the nationwide adoption of solar energy over the last 15 years. You can get solar incentives from your local utility company, the Virginia government or the federal government. When you're ready to switch over to solar energy, talking to your local Manassas solar panel installation expert is an excellent place to start.