2023 Solar Incentives Guide for Poquoson, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Poquoson.
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 September 15, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Poquoson?
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/
The phrase "solar incentives" broadly refers to financial incentives designed to encourage people to use renewable energy by making installing and using solar panels more affordable. Different types of incentives, including discounts, cash back or credit towards your monthly utility bill, might be available to you. Some incentives may be handled by the Virginia government, by your utility company or by county or municipality, while others are federal. Some solar incentives you might qualify for are:
- Net Metering: You may be able to sign a net metering contract with your Poquoson utility company that will apply to all or a percentage of the excess electricity your solar panels generate. Your utility company will then deduct this value from your utility bill each month.
- Tax Exemptions: Sales tax exemptions are effective at the time of purchase for your solar system. Property tax exemptions let you ignore the value that your solar panels add when you're calculating the amount of property tax you need to pay on your house.
- Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are generally handled at the state level. Once your solar system meets the threshold (typically a small amount of energy production), you can receive SRECs that can be sold to your utility company or other buyers. The money you receive is generally considered part of your taxable income.
- Rebates: Your solar installer might help you claim a rebate, or partial refund of your purchase, for your solar panels. Counties or states will also sometimes offer limited-time rebates. If you receive a rebate, that amount will usually come off your total price before any tax credits are calculated.
- Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the federal government. (A tax credit is different from a tax deduction.)
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Federal Solar Incentives
When thinking about solar incentives, you likely think of federal incentives first. You might have heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit that reduces your taxes by a predetermined percentage of the money you spend on solar panels for your home.
The ITC can be credited towards the value of solar panels installed on your primary or secondary residence in the United States. The solar system has to 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 costs (panels, accessories, equipment and labor), although this amount has fluctuated slightly 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 claim amount.
Have questions about how the ITC applies to your specific situation? Contact your local Poquoson solar panel installation expert to get more information.
The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as renaming it to the Clean Energy Credit). For solar systems installed between January 1, 2022 and December 31, 2032, homeowners can receive a credit equal to 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit expires in 2035. Starting in 2023, the expansion to the program will also make claiming credit for energy storage systems easier than ever before.
More information about the new Inflation Reduction Act can be found here. Your local Poquoson solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it applies to you.
State & Local Solar Incentives
Some solar incentives may be provided at the state and local level. Like with federal incentives, these can include tax credits, rebates and more. These incentives might be provided by the Virginia government, or by your county or municipality. Some are available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Poquoson
Solar incentives may be offered by your local utlity company, the Virginia government or the federal government. The growing number of incentives available has contributed to a large increase in solar energy use in the last 15 years. Speak with your local solar panel installer today to find out more information and to save as much money as possible on a solar system for your Poquoson home.
EcoWatch's Poquoson, VA Solar Incentives FAQs
What if I am planning to add solar panels to a rental property, vacation home or commercial property? Can I still qualify for incentives?
While we recommend getting in touch with your local solar installer and/or tax professional to fully understand what solar incentives apply to you, many incentives can be claimed on a second home, as long as it is in the United States and owned by you. There may be additional incentives available for commercial properties specifically, depending on the specifics.
My home already has solar panels. Are there any incentives that I qualify for?
An excellent idea would be to talk to the company that installed your system — or get in touch with a local Poquoson solar installer — to learn about which incentives you might qualify for. If your solar panels were installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
How much will solar panels save me annually on my electric bill in Poquoson?
Once you add solar panels to your house in Poquoson, you can anticipate savings of approximately $993.50 per year, or approximately $18,876.59 over the next 20 years.
What are some environmental benefits of installing solar panels on my home?
You can reduce your carbon footprint by 300 pounds of CO2 annually when you install solar panels. This adds up to roughly 6,000 pounds in 20 years. Solar is also a renewable energy source, which means that making the switch reduces the drain on our planet's resources.
Can I apply for incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can claim both tax credits and rebates towards the cost of solar panels. Depending on precisely which incentives you are applying for, they may apply in a different order. Make sure that you talk to your solar installer or a local tax professional to verify that you are claiming the correct incentives and getting the most money possible.
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.