2023 Solar Incentives Guide for Mechanicsville, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Mechanicsville.
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 May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Mechanicsville?
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 via financial incentives to help people install solar panels on their homes. You may be eligible for several kinds of incentives, including cash back, discounts 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 Virginia government and others from the federal government. You might qualify for any of the following types of solar incentives:
- Tax Credits: Tax credits lower, dollar-for-dollar, the total amount of tax you owe the government. These differ from tax deductions.
- Solar Renewable Energy Certificate (SREC): In most cases, solar systems that produce over a specific (normally small) amount of electricity qualify for SRECs or other similar performance-based incentives. SRECs and performance-based incentives in general are typically given at the state level. When you receive an SREC, you can sell it to your utility company or another buyer, and generally the money you make is normally considered part of your taxable income.
- Tax Exemptions: Your solar panels may qualify for exemptions on both sales and property tax. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions allow you to exclude the value added by your solar panels when calculating property taxes on your house.
- Rebates: Solar rebates may be offered by your local utility company, or by your state or county. These rebates work as cash back that is applied after you pay for a solar system and before tax credits are calculated.
- Net Metering: You can sign a net metering agreement with your Mechanicsville utility company that will apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then subtract this value from your monthly utility bill.
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 best-known federal solar incentive. The ITC provides a tax credit for a specific percentage of your solar system's cost.
The ITC can be applied to a solar system installed on your primary or secondary residence in the United States. The solar panels must have been installed on a property you own after January 1, 2006 for you to be eligible for the credit. Originally, the ITC covered 30% of all system installation costs (panels, accessories, equipment and labor), 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 amount you can claim.
To understand exactly how much money the ITC could save you, speak with your local Mechanicsville solar panel installation expert.
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. With the new provisions, solar installation projects that are completed between 2022 and 2032 might qualify for a 30% tax credit. This percentage will then see a slight annual decrease until the current Clean Energy Credit expires in 2035. Starting 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 fully understand how the new Clean Energy Credit applies to you, reach out to your local Mechanicsville solar installers.
State & Local Solar Incentives
In addition to those provided at the federal level, there are often also state solar incentives. Rebates, tax credits and more may be available at a more local level. These solar incentives — which may be given by the state of Virginia, or by your county or municipality — may be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Mechanicsville
Solar incentives may come from your local utility company, the federal government or the Virginia government. The large number of available incentives has facilitated the nationwide growth of solar energy use in the last 15 years. Your local Mechanicsville solar panel installer can provide you with more details about which incentives you should apply for, and get you feeling good about making the change to renewable energy today.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries
Best Warranty Coverage
Sunpro Solar
- Industry-leading warranty coverage
- Expansive service area
- Some reported communication issues
- No leases or PPAs
EcoWatch's Mechanicsville, VA Solar Incentives FAQs
Can I get any financial incentives when I add solar panels to a vacation home, rental property or commercial property?
Many solar incentives are intended to apply to a property you own that is located within the United States; most secondary residences will fall under this distinction. Other solar incentives may be available for commercial properties, depending on the specifics. We recommend speaking with your local solar installer and/or tax professional to best understand what incentives will apply to your specific situation.
I already have solar panels installed. Do I qualify for any incentives?
If your solar panels were 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 year it was installed. Talking to the company that installed your solar system, or any local Mechanicsville solar installer, can help you understand what incentives you might want to apply for.
What are some environmental benefits of installing solar panels on my home?
Solar energy is a renewable energy source — by changing where you get your energy, you can help lessen the strain on our planet's resources. Solar panels can also reduce the CO2 emissions from your home by 300 pounds annually, or around 6,000 pounds over 20 years.
Can I claim incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order your incentives will be applied in may vary depending on which incentives you are claiming but generally yes, you can claim multiple types of incentives for your solar project. Speak to your solar installer or a local tax professional to be sure you are claiming all the incentives you are eligible for and applying them in the correct order.
Can I use a combination of solar and another type of renewable energy to power my home?
You can power your home with multiple types of renewable energy, or a combination of renewable and non-renewable energy. Be sure to discuss your ideas with your local Mechanicsville solar installation expert. They can help you as you plan for your project and educate you on the various incentives that you might or might not qualify for.
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.