2024 Solar Incentives Guide for Yankton, SD - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Yankton.
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 Yankton?
Renewable Energy System Exemption
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are designed to mitigate the cost of installing a solar panel system on your home. Financial incentives like these are intended to encourage more Americans to switch to renewable energy. Various types of incentives, like cash back, discounts or credit towards your monthly utility bill, may be available to you. Some incentives may be provided via the South Dakota government, by your utility company or by county or municipality, while others are federal. Types of solar incentives might include:
- Net Metering: Net metering becomes relevant once your solar panels are up and running. If you've signed a net metering agreement with your Yankton utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this is a dollar-for-dollar credit, while in other places you may be refunded a percentage of the value.
- Rebates: Solar rebates can be provided by your local utility company, or by your state or county. These rebates are essentially partial refunds that are applied after you purchase a solar system and before tax credits are calculated.
- Tax Exemptions: Tax exemptions can come in two forms. The first is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption, which allows you to ignore the value added by your solar system when calculating property tax for your house.
- Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
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Federal Solar Incentives
Federal solar incentives are likely the first thing that you think of when thinking about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is likely the most commonly known federal solar incentive. The ITC allows you to claim a tax credit for a predetermined percentage of your solar system's cost.
The ITC applies towards solar systems installed after January 1, 2006, and allows you to deduct from your taxes a percentage of the total cost of solar panels, accessories, equipment and labor. You can claim this credit for solar panels installed on a primary or secondary residence in the United States that you own. The original amount you could claim was 30% of the total cost, although certain projects may qualify for only 26%, depending on the details. There is no maximum claim amount.
Your local Yankton solar panel installer can provide more information about the ITC and how it may apply to your situation.
In August 2022, the Inflation Reduction Act expanded and extended the ITC, now dubbed the Clean Energy Credit. The new Clean Energy Credit is valid until 2035. Homeowners are now eligible for a 30% credit for solar systems that began installation on or after January 1, 2022, and will be done by December 31, 2032. This credit will then see a slight annual decrease until it expires. Starting in 2023, the expansion to the program will also make claiming credit for energy storage systems easier than ever before.
Click here to learn more about the new Inflation Reduction Act. To best understand how the new Clean Energy Credit might apply to you, reach out to your local Yankton solar installation expert.
State & Local Solar Incentives
Some solar incentives are often also provided at the state and local level. Similar to federal incentives, these might include tax credits, rebates and more. Certain incentives are ongoing, while others may only be available for a limited time. Solar incentives may be given by the South Dakota government, or by your county or municipality.
Next Steps for Installing Solar in Yankton
You can apply for and receive solar incentives from the federal government and the South Dakota government, as well as from your local utility company. This increase in availability of solar initiatives over the last 15 years has helped increase solar adoption nationwide. We recommend talking to your local Yankton solar installation expert to learn more about these incentives and to ensure that you're getting the most money possible for your solar system.
EcoWatch's Yankton, SD Solar Incentives FAQs
I already have solar panels. Are there any incentives that I qualify for?
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 your system was installed between 2006 and 2021, you may qualify for a tax credit between 26% and 30%, depending on the exact installation date. Speaking with a representative from the company that installed your system, or any local Yankton solar installer, can help you understand what incentives you might want to apply for.
How much will solar panels save me on my electric bill in Yankton annually?
On average, homeowners in Yankton who install solar panels save about $868.83 per year, or about $16,507.75 over 20 years after they make the switch.
What are some environmental benefits of installing solar panels on my home?
You can decrease your carbon footprint by 500 pounds of CO2 annually by installing solar panels. This adds up to around 9,000 pounds in 20 years. Solar is also a renewable energy source, meaning that switching your home over reduces the drain on our planet's resources.
When does the federal solar tax credit end?
The federal solar tax credit, formerly called the ITC and now named 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 use multiple types of renewable energy to power my home?
Yes, you can use multiple types of renewable energy to power your home, such as a combination of solar and wind power. You can also combine renewable energy generation with a backup source of non-renewable energy. Make sure that you discuss your plan with your local Yankton solar panel installer, so that you understand what you'll need and what kinds of incentives you might or might not qualify for.
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.