2023 Solar Incentives Guide for Clarksdale, MS - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Clarksdale.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Clarksdale?
Federal Residential Renewable Energy Tax Credit
Solar incentives are intended to encourage homeowners to switch their home over to renewable energy by providing incentives meant to lower the financial burden of solar panel installation and use. You may be eligible for different types of incentives, such as discounts, cash back or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of Mississippi and others from the federal government. Some solar incentives you might qualify for are:
- Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
- Net Metering: Net metering becomes relevant after your solar system is up and running. If you have a net metering agreement in place with your Clarksdale utility company, they will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some areas, this is a dollar-for-dollar credit, while in other areas you might receive a refund equivalent to a percentage of the value.
- Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar panels. Property tax exemptions let you ignore the value added by your solar system when you're calculating how much property tax you need to pay on your home.
- Rebates: Rebates, or partial refunds after a purchase, are usually given prior to any solar tax credits being calculated. Solar rebates can be offered by your local utility company, by your county or by your state.
Federal Solar Incentives
When someone says "solar incentives," you likely think of federal incentives first. One of the incentives many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a certain percentage of your solar system's cost.
The ITC originally covered 30% of the total cost of solar system installation, although that number has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total cost of installation includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum amount you can claim. The ITC applies to solar panels installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.
Reaching out to your local Clarksdale solar panel installation expert is the best way to understand how the ITC could apply to your situation.
In August 2022, the ITC (now called the Clean Energy Credit) was expanded and extended by the passage of the Inflation Reduction Act. Under the new program, solar installation projects begun after January 1, 2022 and finished by December 31, 2032 might qualify for a 30% tax credit. This percentage will then decrease slightly each year until the current Clean Energy Credit expires in 2035. The expansion also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.
More information about the new Inflation Reduction Act can be found here. To fully understand how the new Clean Energy Credit applies to you, talk to your local Clarksdale solar installation company.
State & Local Solar Incentives
Some solar incentives are often also provided by state and local governments. Like with federal incentives, these may include tax credits, rebates and more. Certain incentives are ongoing, while others might only be available for a limited time. They might be given by your county or municipality, or by the Mississippi government.
Next Steps for Installing Solar in Clarksdale
Solar incentives may come from the federal government, the Mississippi government or your local utility company. The growing number of solar incentives available has helped nationwide use of solar energy increase greatly in the last 15 years. Reaching out to your local Clarksdale solar panel installation company is a great first step towards getting the most money possible when you switch to solar energy.
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EcoWatch's Clarksdale, MS Solar Incentives FAQs
How do I know if I qualify for solar incentives?
Typically, solar incentives apply to:
- a new solar system
- installed on a property that you own
- within the U.S.
- within the date range specified by a particular incentive.
Specific incentives, including those run by the Mississippi government or by your county/municipality, might have additional qualifications. Speak with your local Clarksdale solar installer to discover what incentives your project will qualify for.
I already have solar panels installed. Do I qualify for any incentives?
If your solar system was installed after January 1, 2022, you may qualify for the recently increased 30% tax credit under the Inflation Reduction Act. If you had your system installed between 2006 and 2021, you might qualify for a tax credit between 26% and 30%, depending on the exact installation date. Speaking with the company that installed your solar system, or any local Clarksdale solar installer, can help you learn what incentives you might want to apply for.
Who installs solar panels near me?
To learn about the top solar panel installers near you, read our article on the top solar companies in Clarksdale.
When does the federal solar tax credit end?
The Clean Energy Credit (formerly named the federal solar tax credit, or the ITC), is scheduled to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I claim incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can claim both tax credits and rebates towards the cost of solar panels. Depending on precisely which incentives you are applying for, they may apply in a different order. Make sure that you talk to your solar installer or a local tax professional to verify that you are claiming incentives correctly and getting the most money possible.
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.