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

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

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

Solar incentives are designed to encourage homeowners to switch their home over to renewable energy by providing financial incentives meant to lower the burden of solar panel installation and use. The incentives could include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are handled by the federal government, some by the Minnesota government and some by your specific utility company, county or municipality. Some solar incentives you might qualify for are:

• Tax Exemptions: Tax exemptions can come in two forms. The first is sales tax exemption, which is applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to ignore the value added by your solar system when paying property tax on your house.
• Rebates: Solar rebates might be offered by your local utility company, or by your county or state. These rebates are essentially cash back that is applied after you purchase a solar system and before tax credits are calculated.
• Net Metering: You can sign a net metering agreement with your Richfield utility company, that may apply to all or a percentage of the excess electricity your solar panels generate. Your utility company will then subtract this value from your utility bill each month.
• Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (This is different from a tax deduction.)

Federal Solar Incentives

When you think about solar incentives, you likely think of federal incentives first. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a certain percentage of the money you spend on your solar system.

The ITC applies to solar panels installed after January 1, 2006, on a primary or secondary residence in the United States that you own. Initially, the credit applied to 30% of the total cost – for panels, accessories, labor and equipment – although it may range from 26-30%, depending on the installation date of your solar system. There is no cap on the claim amount.

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

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. The new Clean Energy Credit extends until 2035. Homeowners can now receive a 30% credit for solar systems installed between 2022 and 2032. This new credit will then be decreased by a few percentage points every year until the date of expiration. The program expansion also makes credits for energy storage systems even easier to claim, beginning in 2023.

Click here to learn more about the new Inflation Reduction Act. To best understand how the new Clean Energy Credit will apply to you, speak with your local Richfield solar installation expert.

State & Local Solar Incentives

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

Next Steps for Installing Solar in Richfield

You can qualify for solar incentives from the federal government and the Minnesota government, as well as from your local utility company. The growing availability of solar initiatives in the past 15 years has helped increase solar adoption nationwide. Your local Richfield solar panel installation expert can help you learn more about which incentives you should apply for, and get you started on the path to switching to renewable energy today.