2024 Solar Incentives Guide for Southaven, MS - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Southaven.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Southaven?
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The phrase "solar incentives" refers to a range of financial incentives implemented to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Incentives may include things like discounts, cash back or credit on your utility bill each month. Some incentives are offered federally, while others are offered by the Mississippi government or your utility company, county or municipality. Some broad categories of solar incentives include:
- Net Metering: Net metering is an incentive you can get once your solar system is up and running. If you have a net metering agreement with your Southaven utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this credit is dollar-for-dollar, while in other places you may receive a refund equivalent to a percentage of the value.
- Rebates: Solar rebates can be offered by your state or county, or by your local utility company. These rebates work as cash back that is applied after you purchase solar panels and before tax credits are calculated.
- Tax Exemptions: Tax exemptions can come in one of two forms. First, there is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption, which allows you to exclude the value added by your solar system when calculating property tax for your house.
- Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the federal government. (This is different from a tax deduction.)
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Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some familiarity with. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a certain percentage of your solar system's cost.
The ITC originally covered 30% of the cost of solar system installation, although that number has fluctuated slightly over the last few years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total installation cost includes the panels themselves as well as the cost of accessories, equipment and labor. There is no maximum amount you can claim. The ITC can be applied to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.
To best understand how the ITC will apply to you, contact your local Southaven solar panel installer and request more information.
In August 2022, the Inflation Reduction Act expanded and extended the ITC, now referred to as the Clean Energy Credit. Under the new program, solar installation projects begun after January 1, 2022, and finished by December 31, 2032, can qualify for a 30% tax credit. This credit amount will then decrease slightly each year until the end of the current Clean Energy Credit in 2035. Starting in 2023, it will also be easier to qualify for credits for energy storage systems with the new act.
More information about the new Inflation Reduction Act can be found here. Your local Southaven solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it will apply to you.
State & Local Solar Incentives
Tax credits, rebates and more can be claimed at multiple levels. In addition to federal solar incentives, there are often state and local ones as well. These incentives — which might be given by the state of Mississippi, or by your county or municipality — may be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Southaven
You can qualify for solar incentives from the federal government and the Mississippi government, as well as from your local utility company. The increased availability of solar initiatives in the past 15 years has helped increase solar adoption nationwide. Speaking with your local Southaven solar panel installation expert is the right first step towards getting all the incentives you qualify for when you switch to solar energy.
EcoWatch's Southaven, MS Solar Incentives FAQs
I already have solar panels installed. Do I qualify for any incentives?
If your solar panels were 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 year it was installed. Speaking with the company that installed your solar system, or any local Southaven solar installer, can help you learn what incentives you might want to apply for.
How much will a solar system save me on my electric bill in Southaven annually?
When you add solar panels to your house in Southaven, you can anticipate savings of approximately $825.16 per year, or around $15,678.02 over the next 20 years.
What are the environmental benefits of switching to solar?
You can lower your carbon footprint by 350 pounds of CO2 a year when you switch to solar panels. This adds up to approximately 7,000 pounds in 20 years. Solar is also a renewable energy source, meaning that switching your home over lessens the drain on our planet's resources.
How long until the federal solar tax credit ends?
The Clean Energy Credit (previously referred to as the federal solar tax credit, or ITC), is slated 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 receive incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can receive both rebates and tax credits towards the cost of your solar panels. Depending on which incentives you are claiming, 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 the correct incentives and that you're getting the most money you can.
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.