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

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

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

Solar incentives are intended to make renewable energy usage more affordable through financial incentives to help people install solar panels on their homes. Various types of incentives, like discounts, cash back or credit towards your monthly utility bill, might be available to you. Certain incentives may be handled by the South Dakota government, by your utility company or by county or municipality, while other incentives are federal. Some broad categories of solar incentives include:

• Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you've signed a net metering agreement with your Mitchell utility company, the company will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some places, this is a dollar-for-dollar credit, while in other areas you may make back a percentage of the value.
• Rebates: Solar rebates can be offered by your local utility company, or by your state or county. These rebates work as partial refunds that are applied after your purchase of a solar system and before tax credits are calculated.
• Tax Credits: Tax credits reduce, dollar-for-dollar, how much income tax you owe the government. Tax credits are different from tax deductions.
• Tax Exemptions: Tax exemptions can come in one of two forms. First, there is sales tax exemption, which is applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to exclude the value added by your solar system when paying property tax on your house.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have heard of. The Federal Solar Investment Tax Credit, or ITC, is likely the best-known federal solar incentive. The ITC provides you with a tax credit for a predetermined percentage of your solar system's cost.

The ITC can be applied to the total cost of installing solar panels, including the panels themselves as well as accessories, equipment and labor. This credit can be claimed for panels installed after January 1, 2006, on a primary or secondary residence located in the United States that you own. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum claim amount.

To better understand exactly how much the ITC could save you, talk to your local Mitchell solar panel installation expert.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now titled the Clean Energy Credit. The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar systems installed between 2022 and 2032. At this point, the percentage will decrease slightly each year until the end of the program in 2035. Starting in 2023, the program expansion will also make it easier to get credit for energy storage systems.

Click here to learn more about the new Inflation Reduction Act. Your local Mitchell solar panel company is the best resource for answering your questions about the new Clean Energy Credit and how it applies to you.

State & Local Solar Incentives

There are more than just federal solar incentives; tax credits, rebates and more are often offered at the local or state level. These incentives may be distributed by your county or municipality, or by the South Dakota government. Some incentives may be ongoing, while others are available for a limited time.

Next Steps for Installing Solar in Mitchell

The large number of available solar incentives has enormously increased the use of solar power nationwide over the past 15 years. You might qualify for solar incentives from your local utility company, the federal government or the South Dakota government. Your local Mitchell solar panel installation expert can give you more information about which incentives you can apply for, and get you feeling good about making the change to renewable energy today.