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American Sentry Solar By American Sentry Solar • July 16, 2013

Maryland Solar Tax Incentives and Credits

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There are a variety of tax incentives and tax credits available for homeowners in Maryland purchasing and installing solar energy products. When we work with customers on solar hot water or solar electric installations, we often refer to this list of tax credits and incentives from the state of Maryland, the Federal government and individual Maryland counties. This is only a partial list of residential tax credits and incentives available to homeowners who purchase residential energy materials or pay for products to be installed. If you have questions about specific incentives, feel free to contact us or ask your questions in the comment section below.

Maryland Solar Hot Water Direct Financial Incentives

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  • Federal: 30% Federal Income Tax Credit. There is no maximum credits for systems placed in service after 2008.
  • Most people think that the federal tax credit works like a deduction on your taxes, however this tax credit works like a "dollar for dollar" return. For example, if you were to buy a system that is $10,000, you would receive an additional $3,000 when you file your taxes. This can be extremely helpful for people who usually owe on taxes every year.
  • State: Solar Energy Grant Program. A flat rate in the amount of $500.
  • Your state credit will come in the form of a check. You can expect this within 6 months from the time your system was installed.
  • Anne Arundel County*: 50% of the cost of materials and installation up to $2,500, less any federal and state grants and state energy tax credits.
  • Baltimore County*: The amount of the tax credit is 50% of the eligible costs up to $1,500.
  • Harford County*: The credit amount is equal to one year of totally real property taxes or $2,500, whichever is less. (Based on structure only.) Current wait list is funding in 2016 property tax year.
  • Prince George's County: The amount of the tax credit is 50% of the eligible costs up to $1,500.

* A waiting list for new applicants currently exists; new applicants will receive funding in FY2016 or later. The DSIRE website will have an up to date page for the state of Maryland and each county's incentives.

  • County tax credits work as a credit on your property tax. This will automatically be credited to your mortgage company. You can either take the credit for escrow or contact your mortgage provider and have them cut you a check for the dollar amount. Many county's do a have a waiting list, which you should be aware of. Even if you are unable to receive your credit the following year, it may still be worth it, as you will receive it down the line.
  • SREC's: Solar Renewable Energy Credits or SREC's are credits, which represent the environmental attributes associated with the equivalent generation of 1000 kilowatt-hours (kWh). Most solar providers will provide you will the necessary paperwork for trading your SREC's.
  • Depending on the size of your solar system, it will produce a certain amount of Solar Renewable Energy Credits (SREC's) each year. You will receive 1 credit for every 1,000 kilowatt hour (kWh) that the system produces. The more panels you have on your home, the more kilowatt hours you will produce. The credits that are assigned to you can then be sold back to your utility company every year. You will receive a separate check in the mail for the credits you have earned. This credit/check is in addition to the savings that your solar system will be producing to reduce your utility bill. Be aware that only some states participate in trading SREC's, Maryland is one of them.

Direct Financial Incentives for PV Systems in Maryland

  • Federal: 30% Federal Income Tax Credit. There is no maximum credits for systems placed in service after 2008.
  • Most people think that the federal tax credit works like a deduction on your taxes, however this tax credit works like a "dollar for dollar" return. For example, if you were to buy a system that is $10,000, you would receive an additional $3,000 when you file your taxes. This can be extremely helpful for people who usually owe on taxes every year.
  • State: Solar Energy Grant Program. $1,000 flat grant for a Photovoltaic system.
  • Your state credit will come in the form of a check. You can expect this within 6 months from the time your system was installed.
  • Baltimore County*: The amount of the tax credit is 50% of the eligible costs up to $5,000. Current wait list is funding 2017 property tax year.
  • Harford County*: The credit amount is equal to one year of totally real property taxes or $2,500, whichever is less. (Based on structure only.) Current wait list is funding in 2015 property tax year.
  • Prince George's County: The amount of the tax credit is 50% of the eligible costs up to $5,000.

* A waiting list for new applicants currently exists; new applicants will receive funding in FY2016 or later.

  • County tax credits work as a credit on your property tax. This will automatically be credited to your mortgage company. You can either take the credit for escrow or contact your mortgage provider and have them cut you a check for the dollar amount. Many county's do a have a waiting list, which you should be aware of. Even if you are unable to receive your credit the following year, it may still be worth it, as you will receive it down the line.
  • SREC's: Solar Renewable Energy Credits or SREC's are credits, which represent the environmental attributes associated with the equivalent generation of 1,000 kilowatt-hours (kWh). Most solar providers will provide you will the necessary paperwork for trading your SREC's.
  • Depending on the size of your solar system, it will produce a certain amount of Solar Renewable Energy Credits (SREC's) each year. You will receive 1 credit for every 1000 kilowatt hour (kWh) that the system produces. The more panels you have on your home, the more kilowatt hours you will produce. The credits that are assigned to you can then be sold back to your utility company every year. You will receive a separate check in the mail for the credits you have earned. This credit/check is in addition to the savings that your solar system will be producing to reduce your utility bill. Be aware that only some states participate in trading SREC's, Maryland is one of them.

This list of incentives and tax credits is specific to the state of Maryland and is up-to-date as of July 16th, 2013. Federal, state and county incentives are subject to change.

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