2023 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/

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 Americans to switch their home over to renewable energy. The incentives could include upfront discounts, cash back or monthly credits towards your utility bill. Some incentives are handled by the federal government, some by the state of Minnesota and some by your utility company, county or municipality. You might qualify for any of the following types of solar incentives:

• Tax Exemptions: These may come in the form of property tax exemptions, which can let you exclude the value of your solar system when calculating the taxes you pay on your house. You may also qualify for an exemption on sales tax at the time of purchase.
• Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government. (A tax credit is different from a tax deduction.)
• Net Metering: You can sign a net metering agreement with your New Ulm utility company. This agreement may apply to all or a percentage of the excess electricity your solar panels generate. They will then deduct this value from your utility bill each month.
• Rebates: Rebates, or cash back after a purchase, are normally applied before any solar tax credits are calculated. Rebates might be given by your local utility company, by your county or by your state.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some familiarity with. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit equal to a predetermined percentage of the money you spend on your solar system.

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

Your local New Ulm solar panel installer can offer more information about the ITC and how it may apply to your situation.

The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. Homeowners can now qualify for a credit equal to 30% of the total solar system installation costs for projects started after January 1, 2022 and completed before the end of 2032. This percentage will then decrease yearly until the Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems under this new program.

More information about the new Inflation Reduction Act can be found here. Your local New Ulm solar panel company can answer your questions and explain how the new Clean Energy Credit applies to you.

State & Local Solar Incentives

There are more than just federal solar incentives; tax credits, rebates and more might also be offered at the state and local level. The incentives — which might be provided by the state of Minnesota, or by your county or municipality — could be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in New Ulm

Solar energy use nationwide has gone up significantly in the last 15 years, in part thanks 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. Reach out to your local solar panel installer today to learn more and to save as much money as possible on a solar system for your New Ulm home.