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

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

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

The term "solar incentives" includes a wide range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Incentives can include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered federally, while others are handled by the state of Minnesota or your utility company, county or municipality. Some broad categories of solar incentives include:

• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
• Tax Exemptions: These can come in the form of property tax exemptions, which let you exclude the value of your solar system when paying taxes on your home. They may also include exemptions on sales tax at the time of purchase.
• Net Metering: You may be able to sign a net metering agreement with your New Ulm utility company that will apply to all or a percentage of the excess electricity your solar panels generate. Your utility company will then subtract this value from your monthly utility bill.
• Rebates: A rebate is a partial refund given after you've purchased your solar panels. These could be offered by your local utility company, your county or your state. The rebates are usually applied before tax credits are calculated.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some knowledge of. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a specified percentage of the cost of your solar system.

The ITC can be credited towards the value of solar panels installed on your primary or secondary residence in the United States. The solar system must have been installed after January 1, 2006, on a property you own for you to claim the credit. Originally, the ITC covered 30% of all system costs (panels, accessories, labor and equipment), although the covered amount has fluctuated 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 will apply to you, speak to your local New Ulm solar panel installer and request more information.

The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit re-raises the credit up to 30% for solar installations undertaken between January 1, 2022, and December 31, 2032. After 2032, the percentage will see a slight decrease annually until the program expires in 2035. Starting in 2023, it will also be easier to obtain credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. Your local New Ulm solar panel installer can answer your questions and explain how the new Clean Energy Credit applies to you.

State & Local Solar Incentives

Not all solar incentives are federal; tax credits, rebates and more are often offered at the local or state level. Incentives may be given by your county or municipality, or by the state of Minnesota. Certain incentives may be available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in New Ulm

Solar energy use nationwide has increased enormously in the past 15 years, in part due to the growth in the number of solar incentives. You may get these incentives from your local utility company, the Minnesota government or the federal government. It is a good idea to talk to your local New Ulm solar installer for more information about these incentives and to ensure that you're getting all the money you can for your solar panels.