2023 Solar Incentives Guide for Woodlake, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Woodlake.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Woodlake?
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
Solar incentives are meant to encourage homeowners to switch their home over to renewable energy by providing incentives meant to lower the financial burden of solar panel installation and use. You might qualify for different types of incentives, such as cash back, discounts or monthly utility bill credits, 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 broad categories of solar incentives include:
- Tax Exemptions: Your solar system could qualify for both sales tax and property tax exemptions. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions let you exclude the value added by your solar panels when calculating property taxes on your home.
- Solar Renewable Energy Certificate (SREC): SRECs and other similar performance-based incentives are normally handled at the state level. Once your solar system meets a predetermined threshold (normally a small amount of energy production), you are eligible to receive SRECs that you can then sell to your utility company or other buyers. The money you make from the sale is generally considered part of your taxable income.
- Rebates: Solar rebates can be provided by your state or county, or by your local utility company. These rebates are essentially cash back that is applied after you purchase solar panels and before tax credits are calculated.
- Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (A tax credit is different from a tax deduction.)
- Net Metering: Net metering factors in after your solar system is up and running. If you have a net metering agreement in place with your Woodlake utility company, the company will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some areas, this is a dollar-for-dollar credit, while in other areas you may be refunded a percentage of the value.
Federal Solar Incentives
Federal solar incentives are likely to be the first thing that comes to mind when you think about solar incentives. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a percentage of your solar system's cost.
The ITC applies to solar panels installed after January 1, 2006 on a primary or secondary residence in the United States that you own. Initially, the credit applied to 30% of the total cost — for panels, accessories, labor and equipment — although that amount may range from 26-30%, depending on when your solar system was installed. There is no cap on the claim amount.
To know exactly how much the ITC could save you, speak with your local Woodlake solar panel installer.
The ITC was renewed and increased in scope after 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 equal to 30% of the total solar system installation costs for projects started after January 1, 2022 and completed before the end of 2032. The percentage will then begin to decrease annually until the Clean Energy Credit ends in 2035. The expansion also makes claiming credit for energy storage systems easier than ever before, starting in 2023.
Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit applies to you, reach out to your local Woodlake solar installation company.
State & Local Solar Incentives
Some solar incentives may be provided at the state and local level. Like with federal incentives, these might include tax credits, rebates and more. Some incentives are ongoing, while others are offered for only a limited time. Local solar incentives might come from your county or municipality, or from the Virginia government.
Next Steps for Installing Solar in Woodlake
The variety of available solar incentives has helped tremendously increase the adoption of solar energy nationwide over the past 15 years. You can get solar incentives from the federal government, the Virginia government or from your local utility company. We recommend talking to your local Woodlake solar installation company to learn more about these incentives and to make sure that you're getting the largest number possible for your solar panels.
EcoWatch's Woodlake, VA Solar Incentives FAQs
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.