2024 Solar Incentives Guide for Eagan, MN - Tax Credits & Rebates

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

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

Solar incentives encourage people to switch to renewable energy by providing financial incentives that lower the burden of solar panel installation and use. These incentives might include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are offered by the federal government, some by the Minnesota government and some by your utility company, county or municipality. Types of solar incentives might include:

• Rebates: A rebate is a partial refund given after you've purchased your solar panels. Rebates might be offered by your local utility company, your county or your state. The cash back that you get from the rebates is normally applied before calculating tax credits.
• Net Metering: Be sure to speak with your Eagan utility company about signing a net metering contract. This will allow you to get a credit towards your monthly utility bill for the value of excess energy your solar panels generate. You might receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the federal government. (A tax credit is different from a tax deduction.)
• Tax Exemptions: These may come in the form of property tax exemptions, which can let you exclude the value added by your solar panels when paying property tax on your house. You could also look for exemptions on sales tax at the time of purchase.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some familiarity with. A federal incentive many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a specified percentage of your solar system's cost.

The ITC covers solar systems installed after January 1, 2006, and lets you deduct from your taxes a percentage of the total cost of solar panels, equipment, accessories and labor. You can receive this credit for solar panels installed on a primary or secondary residence that you own in the United States. Originally, you could claim 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum claim amount.

To more fully understand how the ITC may apply to your situation, speak to your local Eagan solar panel installer and request more information.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now referred to as the Clean Energy Credit. The Clean Energy Credit lasts until 2035. Any solar installation project that is completed between January 1, 2022, and December 31, 2032, may qualify for a 30% tax credit. The amount will decrease slightly on a yearly basis until the end of the current program. The expansion also makes it easier to get credit for energy storage systems, beginning in 2023.

More information about the new Inflation Reduction Act can be found here. The best way to learn more about how the new Clean Energy Credit might apply to you is to talk with your local Eagan solar panel company.

State & Local Solar Incentives

Federal solar incentives are not your only option; tax credits, rebates and more might also be offered at the state and local level. These solar incentives — which may be handled by the state of Minnesota, or by your county or municipality — could be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Eagan

Solar incentives can come from the Minnesota government, the federal government or your local utility company. The variety of incentives available has facilitated the nationwide growth of solar energy use in the last 15 years. Reaching out to your local Eagan solar panel installer is the right first step towards getting all the incentives you qualify for when you switch to solar energy.