2025 Solar Incentives Guide for Bloomington, MN - Tax Credits & Rebates

What Solar Tax Credits, Incentives, and Rebates are Available in Bloomington?

Source: https://www.dsireusa.org/

Solar incentives help mitigate the cost of installing a solar panel system on your home. This category of financial incentives is designed to encourage more people to switch to renewable energy. You might qualify for several kinds of incentives, such as cash back, discounts or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the Minnesota government and others from the federal government. Some solar incentives you might qualify for are:

• Rebates: Solar rebates can be offered by your local utility company, or by your county or state. These rebates are essentially cash back that is applied after you pay for solar panels and before tax credits are calculated.
• Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
• Tax Exemptions: These may come in the form of property tax exemptions, which let you exclude the value added by your solar panels when calculating the taxes you pay on your home. You may also qualify for an exemption on sales tax at the time of purchase.
• Net Metering: You may be able to sign a net metering agreement with your Bloomington utility company that will apply to all or a percentage of the excess electricity your solar panels generate. Your utility company will then deduct this value from your utility bill each month.

Federal Solar Incentives

When you hear the term "solar incentives," federal incentives may be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is the best-known federal solar incentive. The ITC provides you with a tax credit for a specific percentage of the cost of your solar system.

The ITC can be applied to a solar system installed on your primary or secondary residence in the United States. The solar system has to have been installed after January 1, 2006, on a property you own for you to claim the credit. Initially, the ITC applied to 30% of all system costs (panels, equipment, labor and accessories), although the covered amount has fluctuated slightly over the years between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the amount you can claim.

To better understand how the ITC could apply to your situation, call your local Bloomington solar panel installation expert and ask for more information.

The ITC has been renewed and expanded following the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. For solar systems installed between January 1, 2022, and December 31, 2032, homeowners can receive a credit for 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit expires in 2035. Starting in 2023, the expansion will also make claiming credit for energy storage systems easier than ever before.

Click here to learn more about the new Inflation Reduction Act. The best way to understand how the new Clean Energy Credit will apply to you is to speak with your local Bloomington solar panel installers directly.

State & Local Solar Incentives

Some solar incentives may be provided by state and local governments. As with federal incentives, these may include rebates, tax credits and more. Incentives may be offered by the state of Minnesota, or by your county or municipality. Some incentives might only be available for a limited time, while others are ongoing.

Next Steps for Installing Solar in Bloomington

Solar incentives can be offered by the Minnesota government, the federal government or your local utility company. The growing number of available incentives has helped nationwide use of solar energy increase greatly in the last 15 years. We recommend talking to your local Bloomington solar installation expert to learn more about these incentives and to ensure that you're getting all the money you can for your solar system.