A Guide to Understanding the Solar Tax Credit in Fort Collins, CO
Did you know there are now enough solar panels in the United States to power 18 million homes? If you've been curious about solar energy, there's never been a better time to invest in the technology.
This is especially true if you live around Fort Collins, Colorado. For one thing, solar panels have never been more affordable. And on top of that, you can take advantage of state and federal incentives for switching to green energy.
These things lie in the solar tax credit, local rebates, and net metering can save you a ton of money on your solar panel system. So, how do they work?
If you want to know the answer to this question, you're in the right place. This guide will walk you through everything you need to know about Fort Collins incentives.
What Is the Federal Solar Tax Credit?
Before we dive into some of the local solar incentives found in Fort Collins, let's explore the solar tax credit available to everyone in the United States.
This federal program offers homeowners a tax credit that they can claim on the cost of their solar panel systems. What's a tax credit? Basically, it's a reduction in the amount of money you owe at the end of the year on your federal income tax.
For example, let's say you were able to claim $2,000 worth in tax credits for your income tax. That means that the amount you owe at the end of the year is reduced by $2,000.
The solar tax credit allows you to take a percentage of what you paid for your solar system to reduce your income tax. So, what percentage can you claim? For the past two years, that amount has been 26%.
However, recently Congress passed an extension of the program. From 2022 to 2032, you can claim 30% of your solar system cost for your tax credit. By 2033, that amount will fall to 26% and 22% by 2034.
Once 2035 rolls around, you will no longer be able to claim it unless Congress plans to renew it again.
The good news is that you have almost a decade to take advantage of the savings. Let's take a closer look at the requirements needed to do so.
What Are the Requirements For Using It In Fort Collins?
The first requirement for the solar tax credit is the day it was installed. It needs to fall between January 1, 2017, and December 31, 2024, for you to claim it.
Also, the solar panel system must be found at one of your residences in the United States. Next, you need to own the solar system. You either need to purchase it outright with cash or use financing options.
Unfortunately, if you're leasing the system or paying the solar company, you won't be able to take advantage of the solar tax credit. Lastly, the solar system must be either new or never used.
If the system is used, you will not be able to claim the tax credit. Remember that the IRS also recently changed the solar tax credit laws. Now, you can claim the tax credit if you purchase an interest in some solar community project located off-site from your residence.
So, if you meet these requirements, then what expenses are included? If you want to learn the answer to this question, you can find out by reading this government resource.
Solar Rebates Available in Fort Collins
Now that we know more about the federal solar tax credit, we can dive into the specific solar incentives found in Fort Collins. Specifically, the city offers a solar rebate to people who install a solar system in their homes.
People who install a PV solar system will receive a rebate of up to $1,000. The rebate is determined by how much energy your solar system produces ($/Watt).
Specifically, you get $250 per kilowatt produced with a maximum amount of $1,000. In addition, Fort Collins Utilities will provide you with a twenty-year Renewable Energy Credit assignment for making the transition to clean energy.
If you want to learn more about solar rebates in Fort Collins, read this resource.
So, how do you qualify for this solar rebate? We'll go over that in the next section.
Requirements For Fort Collins Solar Rebates
The first requirement for the solar rebate is your existing residential customer for Fort Collins Utilities. Next, the solar panel system you purchase must come from the approved solar contractor's list.
You cannot subcontract outside of this network and still receive the rebate. In addition to this, your PV system needs to be greater than 500 watts. The systems must meet utility standards, and the equipment needs to be new, not used.
You also need to ensure that the new solar panels aren't covered by shade from 9 am to 3 pm. You're in charge of managing trees on your property, so they don't interfere with the solar system.
If the efficiency of your system isn't good enough, your incentive rate will be reduced. After you receive your rebate reservation letter, you will have six months to install your system.
Colorado State Sales Tax Exemption for Solar
There's a reason why solar panels are such a good deal in Colorado. It's because the state passed laws to exempt sales and use taxes related to electricity produced by a renewable energy source.
The specific amount of money you can save from this law depends on where you live. But, for most people, it can typically translate to savings of 2.9% on all of your solar parts.
In addition to this, there's also the fact that solar panels increase the property value of your home without raising your property taxes. So, if you want to improve the value of your home without paying a penny, you should consider a solar system.
In the past, Colorado also offered a state tax credit you could take advantage of. Unfortunately, that's no longer an option.
Fort Collins, CO Net Metering
If your solar system is large enough, it's likely you won't use all of the electricity that your system produces. But don't worry; it's not being wasted.
This is thanks to net metering offered by Fort Collins Utilities. Basically, your solar panel system is hooked up to your city's energy grid. Any excess energy you produce immediately flows back into this grid.
That way, it can be used for other homes and businesses that need it. You will receive net metering credits in exchange for the energy your system produces.
You can use these credits to reduce your utility bill each month. It's an excellent option for paying little to nothing on energy bills during cloudy winter months when there's little sun.
Accumulated bill credits will roll over into the next month, so don't panic about spending them quickly. This is an excellent system because it ensures that your entire community benefits from your decision to switch to solar energy.
You can look into battery storage if you don't want to participate in net metering. This is the only other way to prevent energy from being wasted.
How to Find the Best Solar Panel Installer In Fort Collins
When looking for a solar panel installer in Fort Collins, you want someone that combines high-quality work with affordable pricing. The best place to start is with local reviews.
Do a Google search of companies in your area and check what people say online. This will give you a good sense of the average client's experience.
Once you have one or two installation companies, invite them to your property for a consultation. Any company worth their salt will offer you a free estimate before you need to proceed.
Pay attention to the solar contractor when they're at your property. Do they listen to your needs and provide professional advice on placement? Or do they push more extensive systems than you want to make more money?
These are essential questions to ask, and they can often separate the good solar panel installers from the bad ones.
If you want to take advantage of solar rebates in Fort Collins, you should also make sure they're on the list of approved contractors. Otherwise, you can't take advantage of specific savings.
Ready to Start Saving Money On Solar? Contact Skyline Solar
We hope this article helped you understand the solar tax credit and other incentives for switching to solar. Once you understand the incentives, the next step is to find a dependable supplier.
If you're searching in the Fort Collins area, you'll be hard-pressed to find a better option than Skyline Solar. While other companies can delay construction for weeks or even months, we guarantee your project will be completed in one hundred twenty days.
So, if you're ready to start saving both money and the planet, contact Skyline Solar today.