2023 Solar Incentives Guide for Dakota Dunes, SD - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Dakota Dunes.
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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Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Dakota Dunes?
Renewable Energy System Exemption
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The phrase "solar incentives" refers to a wide range of financial incentives put in place to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Various types of incentives, including discounts, cash back or monthly utility bill credits, might be available to you. Certain incentives may be provided via the South Dakota government, by your utility company or by county or municipality, while other incentives are federal. Types of solar incentives might include:
- Net Metering: Make sure you speak to your Dakota Dunes utility company about signing a net metering contract. This allows you to receive credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You could receive either a dollar-for-dollar credit or a percentage of the value.
- Rebates: Some solar companies will help you claim a rebate, or partial refund after purchase, for your solar system. Counties or states will also offer limited-time rebates at various times. Any rebates you receive will usually come off your total price before any tax credits are calculated.
- Tax Exemptions: These may come in the form of property tax exemptions, which would allow you to ignore the value added by your solar panels when paying taxes on your home. You could also look for exemptions on sales tax at the time of purchase.
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some knowledge of. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a percentage of the cost of your solar system.
The ITC can be applied to solar systems installed after January 1, 2006 on a primary or secondary residence that you own in the United States. The credit initially covered 30% of the total cost — for panels, equipment, labor and accessories — 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 Dakota Dunes solar panel installer can give you more information about the ITC and how it might apply to your situation.
In August 2022, the ITC (now referred to as the Clean Energy Credit) was expanded and extended by the passage of the Inflation Reduction Act. Homeowners are now eligible for a credit equal to 30% of the total solar system installation costs for projects started after January 1, 2022 and completed before the end of 2032. The percentage will then decrease yearly until the Clean Energy Credit expires in 2035. Starting in 2023, it will also be easier to qualify for credits for energy storage systems under the new laws.
Click here to learn more about the new Inflation Reduction Act. Your local Dakota Dunes solar panel installation experts can answer your questions and explain how the new Clean Energy Credit may apply to you.
State & Local Solar Incentives
Tax credits, rebates and more can be provided at multiple levels. Along with federal solar incentives, there are often state and local ones, too. The incentives — which might be provided by your county or municipality, or by the state of South Dakota — might be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Dakota Dunes
The variety of available solar incentives has contributed greatly to the increase in the use of solar power nationwide over the past 15 years. You can get solar incentives from your local utility company, the South Dakota government or the federal government. We suggest talking to your local Dakota Dunes solar installer to learn more about these incentives and to ensure that you're getting the largest number possible for your solar panels.
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EcoWatch's Dakota Dunes, SD Solar Incentives FAQs
What if I am planning to add a solar system to a rental property, vacation home or commercial property? Will I still qualify for incentives?
Many solar incentives apply to a property located within the United States that you own, and most secondary residences fall into this category. There may be other solar incentives available for commercial properties, depending on the details. We recommend talking to your local solar installer and/or tax professional to fully understand what incentives apply to your specific situation.
Who installs solar panels near me?
To find the best solar panel installer in your area, check out our guide to the top solar companies in Dakota Dunes.
What are the environmental benefits of switching to solar energy?
Solar energy is renewable — by switching where you get your energy, you can help lessen the strain on our planet's resources. You can also reduce the CO2 emissions from your home by 450 pounds annually, or around 9,000 pounds over 20 years.
When does the federal solar tax credit end?
The federal solar tax credit, formerly called the ITC and now titled the Clean Energy Credit, is set to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit 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 your solar panels. Depending on which incentives you are eligible for, they may apply in a different order. Make sure that you talk to your solar installer or a local tax professional to ensure that you are claiming the correct incentives and that you're 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.