2023 Solar Incentives Guide for Sauk Rapids, MN - Tax Credits & Rebates

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

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

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

• Net Metering: You can sign a net metering contract with your Sauk Rapids utility company, that may apply to all or a percentage of the excess electricity your solar panels generate. They will then subtract this value from your utility bill each month.
• Tax Credits: Tax credits lower, dollar-for-dollar, how much income tax you owe the federal government. These differ from tax deductions.
• Tax Exemptions: Tax exemptions can come in two forms. First, there is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption. This allows you to exclude the value added by your solar system when paying property tax on your home.
• Rebates: Solar rebates might be provided by your state or county, or by your local utility company. These rebates work as partial refunds that are applied after you purchase a solar system and before tax credits are calculated.

Federal Solar Incentives

Federal solar incentives are likely the first thing that comes to mind when thinking about solar incentives. An incentive that most people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a predetermined percentage of your solar system's cost.

The ITC applies towards solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, accessories, labor and equipment. 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 certain projects may qualify for only 26%, depending on the details. There is no maximum amount you can claim.

Have questions about how the ITC applies to your specific situation? Contact your local Sauk Rapids solar panel installer to get more information.

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. The new Clean Energy Credit now runs until 2035. Homeowners are now eligible for a 30% credit for solar systems that began installation after January 1, 2022 and are completed by the end of 2032. This new credit will then see a slight annual decrease until it expires. The expansion also makes it easier to get credit for energy storage systems, starting in 2023.

More information about the new Inflation Reduction Act can be found here. To understand how the new Clean Energy Credit applies to you, talk to your local Sauk Rapids solar installation expert.

State & Local Solar Incentives

Rebates, tax credits and more might be provided at multiple levels. On top of federal solar incentives, there are often state and local ones, too. These incentives — which might be handled by your county or municipality, or by the state of Minnesota — may be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Sauk Rapids

Solar incentives may come from your local utlity company, the Minnesota government or the federal government. The growing number of available incentives has contributed to a large increase in solar energy use in the last 15 years. Getting in touch with your local Sauk Rapids solar panel installation expert is an excellent first step towards getting the most money possible when you switch to solar energy.