2023 Solar Incentives Guide for Sugarland Run, VA - Tax Credits & Rebates

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

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

Solar incentives mitigate the cost of installing solar panels on your home. Financial incentives like these are in place to encourage more homeowners to switch to renewable energy. Incentives could include things like discounts, cash back or credit on your utility bill each month. Some incentives are offered federally, while others are handled by the state of Virginia or by your utility company, county or municipality. Some solar incentives you might qualify for are:

• Net Metering: Net metering is an incentive you can get once your solar panels are up and running. If you've signed a net metering agreement with your Sugarland Run utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in other areas you may make back a percentage of the value.
• Rebates: Rebates, or partial refunds after a purchase, are usually applied prior to any solar tax credits being calculated. Rebates can be given by your local utility company, by your state or by your county.
• Tax Exemptions: Tax exemptions can come in two forms. First, there is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption, which allows you to exclude the value added by your solar system when paying property tax on your house.
• Solar Renewable Energy Certificate (SREC): SRECs can be sold to your utility company (or other buyers) for cash that normally counts as part of your taxable income. In most cases, there is a small threshold of energy production to meet before your solar system qualifies for SRECs or similar performance-based incentives. These kinds of incentives are typically handled at the state level.
• Tax Credits: Tax credits lower, dollar-for-dollar, how much income tax you owe the federal government. These differ from tax deductions.

Federal Solar Incentives

When you hear the term "solar incentives," federal incentives may be the first thing that comes to mind. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit that reduces your taxes by a certain percentage of the money you spend on your solar system.

The ITC can be credited towards the value of a solar system installed on your primary or secondary residence in the United States. The solar panels have to have been installed on a property you own after January 1, 2006 for you to claim the credit. The ITC initially covered 30% of all system costs (panels, accessories, labor and equipment), 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 amount you can claim.

To best understand how the ITC could apply to your situation, speak to your local Sugarland Run solar panel installation expert and ask for more information.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now dubbed the Clean Energy Credit. The Clean Energy Credit lasts until 2035. Any solar installation project that is completed between January 1, 2022 and December 31, 2032 may qualify for a 30% tax credit. This amount will then decrease slightly each year until the end of the current program. Beginning in 2023, it will also be easier to claim credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. Your local Sugarland Run solar panel installer can answer any questions you have and explain how the new Clean Energy Credit may apply to you.

State & Local Solar Incentives

In addition to federal solar incentives, there are often also state ones. Tax credits, rebates and more may be available at a more local level. Incentives may be handled by your county or municipality, or by the state of Virginia. Some incentives might only be available for a limited time, while others are ongoing.

Next Steps for Installing Solar in Sugarland Run

You can receive solar incentives from the Virginia government and the federal government, as well as from your local utility company. This increase in availability of solar initiatives over the last 15 years has helped greatly increase nationwide adoption of solar energy. If you're ready to make the change to solar energy, getting in touch with your local Sugarland Run solar panel installation expert is a great first step.