2023 Solar Incentives Guide for Cottage Grove, WI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Cottage Grove.
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 Cottage Grove?
Renewable Energy Sales Tax Exemptions
Renewable Rewards Program
Business - 0-5 kW: $200 per kW
5-10 kW: $1000 + $150 per kW over 5
10-100 kW: $1750 + $125 per kW over 10
100-300 kW: $13000 + $100 per kW over 100
300-500 kW: $33000 + $85 per kW over 300
Biogas, Solar, and Wind Energy Equipment Exemption
Federal Residential Renewable Energy Tax Credit
Solar incentives are designed to encourage people to make the switch to renewable energy by providing incentives that lower the financial burden of solar panel installation and use. Incentives may include things like discounts, cash back or monthly utility bill credits. Some incentives are handled federally, while others are handled by the state of Wisconsin or by your specific utility company, county or municipality. Categories of solar incentives include:
- 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 once your solar system is up and running. If you've signed a net metering agreement with your Cottage Grove utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in other areas you might be refunded a percentage of the value.
- Rebates: A rebate is a partial refund credited to your account after you've paid for your solar panels. Rebates might be offered by your local utility company, your state or your county. The cash back that you get from the rebates is normally applied before tax credits are calculated.
- Tax Exemptions: These might come in the form of property tax exemptions, which can let you ignore the value of your solar system when paying taxes on your home. They may also include exemptions on sales tax at the time of purchase.
Federal Solar Incentives
Federal solar incentives are likely to be the first thing that you think of when you think about solar incentives. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a certain percentage of your solar system's cost.
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, labor and accessories. This credit can be claimed on solar panels installed on a primary or secondary residence that you own in the United States. The original claim amount was 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum amount you can claim.
Talking to your local Cottage Grove solar panel installer is the best way to understand how the ITC may apply to you.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now titled the Clean Energy Credit. For solar systems installed between January 1, 2022 and December 31, 2032, homeowners can apply for a credit equal to 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit expires in 2035. The expansion also makes it easier to get credit for energy storage systems, starting in 2023.
More information about the new Inflation Reduction Act can be found here. To fully understand how the new Clean Energy Credit might apply to you, reach out to your local Cottage Grove solar installation expert.
State & Local Solar Incentives
Federal solar incentives are not your only option; rebates, tax credits and more are often offered at the state and local level. The incentives — which may be handled by the state of Wisconsin, or by your county or municipality — might be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Cottage Grove
There are many kinds of solar incentives: those given by the federal government, those given by the Wisconsin government and those given by local utility companies, to name a few. Solar energy utilization has increased enormously in the last 15 years, partially due to these incentives. Your local Cottage Grove solar panel installation expert can give you more information about which incentives you may qualify for, and get you feeling good about making the change to renewable energy today.
EcoWatch's Cottage Grove, WI 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.