Solar Rebate: How do Solar Rebates Work?

November 14, 2022

Solar Rebate: How do Solar Rebates Work?

Solar Rebate: How do Solar Rebates Work?

What Are Solar Rebates?

Put simply, a tax credit is a dollar-for-dollar reduction in the amount of income tax you would otherwise be charged. For example, whatever figure of $ tax credit you are entitled to claim (for various reasons) will reduce your personal tax burden each year. Although there has been an increase in tax credit percentage amount in 2022 (30%), there has previously been a tax credit percentage in place over the previous 2 years (26%) to encourage people to move to a cleaner energy source, with no maximum amount that can be claimed come tax season.

Now, like all tax breaks, the solar rebate is accessible to people who reach certain criteria, which we’ve outlined below: 

 

  • Your solar PV system was installed between January 1, 2017 and December 31, 2034.
  • The solar PV system is located at a residence of yours in the United States.
  • You purchased an interest in an off-site community solar project if the electricity generated is credited against and does not exceed your home’s electricity consumption
  • You own the solar PV system
  • The solar PV system is new or being used for the first time. The credit can only be claimed on the “original instillation’ of the solar equipment.

Expenses To Consider Relating To Solar Rebates

What expenses are included throughout the installation?

  • Solar PV panels or PV cells.
  • Contractor labor costs for onsite preparation, assembly, or original installation, including permitting fees, inspection costs, and developer fees.
  • Balance-of-system equipment, including wiring, inverters, and mounting equipment.
  • Energy Storage Devices that have a capacity of 3 kWh or greater.
  • Sales taxes on eligible expenses.

The solar panel rebate is only one of the solar incentives available to those choosing the renewable energy option to power their homes which may be different from state to state therefore how it will affect other incentives has to be taken and considered on an individual basis when researching the best options for you. 

Is There Enough Support to Convince You?

When making your decision to move to solar-produced energy, one of the many factors to take into account is how the solar incentives will affect you and therefore, it is imperative to make sure you seek independent professional tax advice to ensure you are eligible for the credit ahead of time – no one would want to find out during tax season that you’re not actually entitled to claim!

So, with all of this new help in the form of the solar panel rebate, is this enough to tip the scales in favor of renewable energy for your household? Not only will the solar rebate help with the costs of installation, but once in place, you can’t ignore the fact that your home energy costs will be significantly reduced. Not to mention that you’ll be helping to protect the planet for future generations! So make a wise and sustainable decision!