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

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

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

The term "solar incentives" refers to a wide range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. You might be eligible for different types of incentives, such as discounts, cash back or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of Virginia and others from the federal government. Some solar incentives you might qualify for are:

• Tax Exemptions: Tax exemptions can come in one of two forms. First, there is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption. This allows you to ignore the added value of your solar system when paying property tax on your house.
• Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar system. These may be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
• Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives might be available to you if you have a solar system that produces more than a specified (generally small) amount of electricity. This category of incentives is usually handled at the state level. You can sell SRECs to your utility company or other buyers, and the money you make is usually considered part of your taxable income.
• Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
• Net Metering: Net metering becomes relevant once your solar panels are up and running. If you have a net metering agreement with your Staunton utility company, the company will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in other places you might receive a refund equivalent to a percentage of the value.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some knowledge of. The Federal Solar Investment Tax Credit, or ITC, is probably the most well-known federal solar incentive. The ITC provides you with a tax credit for a specific percentage of your solar system's cost.

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

Contacting your local Staunton solar panel installer is the best way to learn more about how the ITC applies to your situation.

The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as retitling it the Clean Energy Credit). The new Clean Energy Credit is valid until 2035. Homeowners can now apply for a 30% credit for solar systems installed between January 1, 2022, and December 31, 2032. The total credit will then be decreased by a few percentage points every year until its expiration. Starting in 2023, it will also be easier to qualify for credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. Your local Staunton solar panel company can answer your questions and explain how the new Clean Energy Credit will apply to you.

State & Local Solar Incentives

Some solar incentives are often also provided by state and local governments. Similar to federal incentives, these could include tax credits, rebates and more. These incentives — which may be provided by the state of Virginia, or by your county or municipality — could be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Staunton

There are a variety of solar incentives: those offered by the federal government, those offered by the Virginia government and those offered by local utility companies, to name a few. The use of solar energy has grown enormously in the last 15 years, partially thanks to these incentives. If you're ready to make the switch to solar energy, talking to your local Staunton solar panel installation expert is an excellent place to start.