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

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

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

Solar incentives are designed to make renewable energy usage more affordable through financial incentives to help people install solar panels on their homes. These incentives might include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are handled 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 Exemptions: These could come in the form of property tax exemptions, which allow you to ignore the value of your solar system when paying taxes on your house. You could also look for exemptions on sales tax at the time of purchase.
• Tax Credits: Tax credits reduce, dollar-for-dollar, how much income tax you owe the government. Tax credits differ from tax deductions.
• Solar Renewable Energy Certificate (SREC): In most cases, solar systems that produce more than a predetermined (generally small) amount of electricity qualify for SRECs or other similar performance-based incentives. SRECs and the like 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.
• Net Metering: Net metering factors in after your solar system is up and running. If you've signed a net metering agreement with your Newington Forest utility company, it will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this is a dollar-for-dollar credit, while in other areas you may get refunded a percentage of the value.
• Rebates: Solar rebates might be provided by your local utility company, or by your state or county. These rebates are essentially cash back that is applied after your purchase of a solar system and before tax credits are calculated.

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're most likely to have heard of 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 originally covered 30% of the cost of installing solar panels, and has fluctuated slightly over the last few years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total cost of installation includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum amount you can claim. The ITC applies to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.

Your local Newington Forest solar panel installation expert can provide more information about the ITC and how it applies to your situation.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now called the Clean Energy Credit. The Clean Energy Credit is valid until 2035. Any solar installation project that is completed between January 1, 2022, and December 31, 2032, may qualify for a 30% tax credit. The amount will then decrease slightly on a yearly basis until the current program ends. Starting in 2023, the program expansion will also make credits for energy storage systems even easier to claim.

More information about the new Inflation Reduction Act can be found here. Your local Newington Forest solar panel company can answer any questions you have and explain how the new Clean Energy Credit will apply to you.

State & Local Solar Incentives

Some solar incentives may be offered at the local or state level. Like with federal incentives, these could include tax credits, rebates and more. Incentives might be provided by the state of Virginia, or by your county or municipality. Some incentives might only be available for a limited time, while others are ongoing.

Next Steps for Installing Solar in Newington Forest

Solar energy use nationwide has significantly increased in the last 15 years, in part thanks to the proliferation of solar incentives. You might receive these incentives from your local utility company, the Virginia government or the federal government. We suggest talking to your local Newington Forest solar installer to learn more about these incentives and to ensure that you're getting the most money possible for your solar system.