2025 Solar Incentives Guide for Box Elder, SD - Tax Credits & Rebates

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

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

Solar incentives are designed to mitigate the cost of installing solar panels on your home. These financial incentives are intended to encourage more homeowners to make the switch to renewable energy. The incentives could include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are given by the federal government, some by the state of South Dakota and some by your specific utility company, county or municipality. Types of solar incentives might include:

• Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
• Net Metering: Net metering becomes relevant after your solar panels are up and running. If you've signed a net metering agreement with your Box Elder 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 is a dollar-for-dollar credit, while in other places you may make back a percentage of the value.
• Tax Exemptions: Your solar system may qualify for both sales tax and property tax exemptions. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions allow you to exclude the value added by your solar panels when calculating property taxes on your house.
• Rebates: Your solar installer might help you claim a rebate, or partial refund after purchase, for your solar panels. Counties or states will also sometimes offer limited-time rebates. If you receive a rebate, that amount will usually be deducted from your total price before tax credits are calculated.

Federal Solar Incentives

When you hear the term "solar incentives," federal incentives are likely the first thing that comes to mind. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a percentage of the cost of your solar system.

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, equipment, labor and accessories. You can receive this credit for a solar panel system installed on a primary or secondary residence in the United States that you own. Originally, you could claim 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum claim amount.

To find out exactly how much the ITC could save you, get in touch with your local Box Elder solar panel installer.

In August 2022, the ITC (now titled the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar systems installed between 2022 and 2032. After 2032, the percentage will be reduced slightly each year until the program expires in 2035. Starting in 2023, it will also be easier to obtain credits for energy storage systems with the new act.

More information about the new Inflation Reduction Act can be found here. The easiest way to learn more about how the new Clean Energy Credit might apply to you is to speak with your local Box Elder solar panel company directly.

State & Local Solar Incentives

There are often also state solar incentives in addition to those provided by the federal government. Rebates, tax credits and more can be offered at a more local level. Some incentives are ongoing, while others are offered for only a limited time. Your local incentives may come from your county or municipality, or from the South Dakota government.

Next Steps for Installing Solar in Box Elder

You can apply for solar incentives from the South Dakota government and the federal government, as well as from your local utility company. The growing availability of solar initiatives in the past 15 years has helped greatly increase nationwide adoption of solar energy. Call your local solar panel installer today to discover more about the various programs and to save the most money possible on solar panels for your Box Elder home.