2023 Solar Incentives Guide for Reston, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Reston.
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 Reston?
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 encourage people to make the switch to renewable energy by offering financial incentives that lower the burden of solar panel installation and use. Solar incentives can include upfront discounts, cash back or monthly credits towards your utility bill. Some incentives are provided by the federal government, some by the state of Virginia and some by your specific utility company, county or municipality. Some solar incentives you might qualify for are:
- Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that typically becomes part of your taxable income. Typically, you must meet a certain (small) threshold of energy production before your solar system can earn SRECs or other performance-based incentives. SRECs and similar incentives are typically handled at the state level.
- Net Metering: Net metering becomes relevant once your solar system is up and running. If you've signed a net metering agreement with your Reston utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some places, this is a dollar-for-dollar credit, while in other places you might receive a refund equivalent to a percentage of the value.
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (This is different from a tax deduction.)
- Tax Exemptions: Sales tax exemptions go into effect at the point of sale for your solar system. Property tax exemptions let you ignore the value that your solar panels add when you calculate how much property tax you need to pay on your house.
- Rebates: A solar rebate is a partial refund given after you've purchased your solar panels. These may be offered by your local utility company, your state or your county. The rebates are usually applied before calculating tax credits.
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Federal Solar Incentives
Federal solar incentives are probably the first thing that comes to mind when thinking about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is likely the best-known federal solar incentive. The ITC provides you with a tax credit for a set percentage of the cost of your solar system.
The ITC can be applied to solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, equipment, accessories and labor. You can claim this credit for solar panels installed on a primary or secondary residence in the United States that you own. Originally, you could claim 30% of the total cost, although certain projects may qualify for only 26%, depending on the details. There is no maximum claim amount.
To more fully understand how the ITC might apply to you, call your local Reston solar panel installer 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. Homeowners can now receive a credit of 30% of the total solar system installation costs for projects started after January 1, 2022 and completed before the end of 2032. The credit percentage will then begin to decrease annually until the Clean Energy Credit ends in 2035. Starting in 2023, the expansion to the program will also make it easier to get credit for energy storage systems.
Click here to learn more about the new Inflation Reduction Act. Your local Reston solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it may apply to you.
State & Local Solar Incentives
Rebates, tax credits and more might be provided at multiple levels. Along with federal solar incentives, there are often state and local ones, too. These solar incentives — which might be handled by your county or municipality, or by the state of Virginia — may be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Reston
Nationwide solar energy use has increased enormously in the last 15 years, in part due to the proliferation of solar incentives. You may get these incentives from the federal government, the Virginia government or your local utility company. Reach out to your local solar panel installation expert today to find out more information and to save as much money as possible on solar panels for your Reston home.
EcoWatch's Reston, VA Solar Incentives FAQs
What if I want to add a solar system to a vacation home, rental property or commercial property? Do I still qualify for incentives?
While we recommend getting in touch with your local solar installer and/or tax professional to best understand what solar incentives apply to you, many will apply to a second home, so long as that home is in the United States and owned by you. There may be other incentives available specifically for commercial properties, depending on the details.
My home already has solar panels installed. Are there any incentives that I qualify for?
You should plan to talk to the company that installed your system — or call a local Reston solar installer — to clarify which incentives you may qualify for. If your system was installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar panels installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
How much can I save annually on my electric bill if I add solar panels to my house in Reston?
Once you add solar panels to your house in Reston, you can expect to save about $898.00 per year, or about $17,062.02 over the next 20 years.
What are the environmental benefits of switching to solar?
You can lower your carbon footprint by 300 pounds of CO2 annually by installing solar panels. This adds up to approximately 6,000 pounds over 20 years. In addition, solar power is a renewable energy source, which means that switching your home over reduces the drain on our planet's resources.
If I trade in my appliances for ones that utilize solar energy, are there any incentives that I can claim?
The new Inflation Reduction Act introduces a number of incentives designed to reward homeowners for making eco-friendly upgrades. Some incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.
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.