2023 Solar Incentives Guide for Elk River, MN - Tax Credits & Rebates

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

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

Solar incentives mitigate the cost of installing solar panels on your home. These financial incentives are designed to encourage more people to make the switch to renewable energy. Incentives can include things like discounts, cash back or monthly utility bill credits. Some incentives are offered by the federal government, while others are offered by the state of Minnesota or your utility company, county or municipality. Categories of solar incentives include:

• Tax Exemptions: Your solar panels might qualify for exemptions on both sales and property tax. Sales tax exemptions are applied at the time of purchase. Property tax exemptions let you ignore the value added by your solar panels when calculating property taxes on your house.
• Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government. (This is different from a tax deduction.)
• Rebates: Solar rebates may be offered by your local utility company, or by your county or state. These rebates work as partial refunds that are applied after your purchase of a solar system and before tax credits are calculated.
• Net Metering: You can sign a net metering agreement with your Elk River utility company, that may apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then deduct this value from your monthly utility bill.

Federal Solar Incentives

When you think about solar incentives, you probably think of federal incentives first. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a specified percentage of your solar system's cost.

The ITC applies towards solar systems installed after January 1, 2006 and under this program you can deduct from your taxes a percentage of the total cost of solar panels, labor, equipment and accessories. You can claim this credit for a solar panel system installed on a primary or secondary residence that you own in the United States. Originally, you could claim 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum claim amount.

Speaking with your local Elk River solar panel installer is the best way to learn more about how the ITC could apply to you.

In August 2022, the ITC (now titled the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. Under the new program, solar installation projects begun after January 1, 2022 and finished by December 31, 2032 can qualify for a 30% tax credit. This credit amount will then decrease slightly each year until the current Clean Energy Credit expires in 2035. Starting in 2023, the expansion to the program will also make it easier to get credit for energy storage systems.

Click here to learn more about the new Inflation Reduction Act. The easiest way to fully understand how the new Clean Energy Credit applies to you is to talk with your local Elk River solar panel installers.

State & Local Solar Incentives

Some solar incentives may be provided by state and local governments. Similar to federal incentives, these can include rebates, tax credits and more. The incentives — which might be handled by your county or municipality, or by the state of Minnesota — might be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Elk River

Solar incentives may be provided by your local utlity company, the Minnesota government or the federal government. The large number of available incentives has facilitated the nationwide growth of solar energy use in the last 15 years. If you're ready to make the change to solar energy, talking to your local Elk River solar panel installation expert is an excellent place to start.