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

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

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

Solar incentives help mitigate the cost of installing a solar panel system on your home. This category of financial incentives is in place to encourage more homeowners to switch their home over to renewable energy. Various kinds of incentives, such as discounts, cash back or monthly utility bill credits, may be available to you. Some incentives may be provided via the Virginia government, by your utility company or by county or municipality, while other incentives are federal. Categories of solar incentives include:

• Tax Exemptions: These can come in the form of property tax exemptions, which let you exclude the value of your solar system when paying taxes on your house. You may also qualify for an exemption on sales tax at the time of purchase.
• Tax Credits: Tax credits reduce, dollar-for-dollar, the amount of income tax you owe the government. Tax credits are different from tax deductions.
• Rebates: Solar rebates may be provided by your county or state, or by your local utility company. These rebates work as partial refunds that are applied after you pay for a solar system and before tax credits are calculated.
• Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce more than a predetermined (normally small) amount of electricity can qualify for SRECs or other performance-based incentives. SRECs and the like are typically given by your state government. You can sell SRECs to your utility company or another buyer, and this is usually considered part of your taxable income.
• Net Metering: Net metering factors in after your solar system is up and running. If you've signed a net metering agreement with your Montclair utility company, the company will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some areas, this is a dollar-for-dollar credit, while in other areas you might get refunded a percentage of the value.

Federal Solar Incentives

When you think about solar incentives, you probably think of federal incentives first. You may have heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit that reduces your taxes by a specified percentage of the money you spend on your solar system.

The ITC initially applied to 30% of the total cost of installing a solar system, although it has fluctuated slightly over time between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total installation cost includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum claim amount. The ITC applies to solar systems installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.

To more fully understand how the ITC will apply to you, call your local Montclair solar panel installation expert and request 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 re-raises the credit up to 30% for solar installations undertaken between January 1, 2022, and December 31, 2032. At this point, the credit percentage will see a slight decrease annually until the end of the program in 2035. The expansion to the program also makes it easier to get credit for energy storage systems, starting in 2023.

More information about the new Inflation Reduction Act can be found here. To better understand how the new Clean Energy Credit will apply to you, speak with your local Montclair solar installation expert.

State & Local Solar Incentives

There are more than just federal solar incentives; rebates, tax credits and more might also be offered at the local or state level. Incentives may be handled by your county or municipality, or by the state of Virginia. Some incentives may be available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in Montclair

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 nationwide solar energy use enormously. It is a good idea to talk to your local Montclair solar installation company for more information about these incentives and to be sure that you're getting the most money possible for your solar panels.