There are all sorts of reasons to move towards solar power. No matter your logic, you are doing something good. Whether you make the change to solar for you or the environment, both will be greatly helped.
If you are moving to solar panel to save money, you are making a great choice. Not only will you save on your electric bill, but receive tax credits as well. There are all types of incentives for moving towards more energy efficient methods, but tax incentives are one of the big ones. Each individual state offers different tax incentives for their residence that chose to utilize solar power. Learning what credits your state offers is essential for getting the best deal.
State by state
Depending on the state you live in, you could receive a huge tax break just for using solar energy. For example, California has long been a huge support of solar power. It has been the state that others follow on different issues related to energy efficiency. With the California Solar Incentives, rebates and performance-based incentives are set up to help residence save money.
It’s not all about the performance of your solar power, but the installation as well. Completely switching from one mode of power to solar can be an expensive process. Many states offer rebates on the installation of the solar equipment. Utah for example will give its residence a 25% refund on all solar equipment purchased up to $2,000. Solar can range from being much less expensive than this, to way more.
There is a difference between the renewable energy/investment tax credit, and the renewable energy/production tax credit. The first one will help you save money on products you have purchased for energy, while the second will increase your savings after the products have been put to use.
Federal
Federal tax credits are also available. Solar energy system tax credits are some of the highest you can get. There are three products that will earn you a 30% credit with no upper limit, they are:
- Geothermal heat pumps
- Small wind turbines (residential)
- Solar energy systems
The two most common types of solar energy systems that can be used as tax credits are solar water heaters and solar panels. Each has their own set of requirements to apply for the incentive.
There are many different types of solar water heaters. The type you buy could determine your tax savings. To receive the federal tax credit, at least half the energy generated must come from the sun. Although it is a helpful resource in any state to utilize a solar water heater, the tax credit may only come in states that see enough sun to produce half the energy needed. Depending on how much hot water you use in a day, those living in Washington may be out of luck, but Arizonians should be just fine.
Solar panels are becoming increasingly popular every year. It is a great way to get all your power needs, without throwing money down the drain. The requirements for receiving tax credits for solar panels are much easier than with water heaters. The only requirement here is that the panels provide electricity for the home, and follow all electrical code requirements.
Using solar energy
There are all sorts of ways to use solar energy. From heating to lighting, everybody can gain from using the sun for their needs. There are even solar chargers for electronics. Those who don’t want to install solar panels to their home just yet can take advantage of solar chargers to save on the energy costs of charging your phone, laptop, or other electronic device.
There are more advantages to using solar power than the obvious. Look into the tax incentives in your state, as well as the federal ones. You may be surprised what savings you may find.
Cassie has researched multiple websites the tax advantages of solar energy, including energystar.gov and arcblueelectric.com. She has looked into the advantages and disadvantages of turning towards energy efficiency. Tax breaks have been one of the leading advantages.