2023 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 2023 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
Solar incentives encourage people to switch their home over to renewable energy by offering incentives meant to lower the financial burden of solar panel installation and use. Various types of incentives, including cash back, discounts or credit towards your monthly utility bill, may be available to you. Certain incentives may be handled by the state of South Dakota, by your utility company or by county or municipality, while others are federal. You might qualify for any of the following types of solar incentives:
- Net Metering: Be sure to talk with your Yankton utility company about signing a net metering agreement. This will allow you to get a credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You might receive either a dollar-for-dollar credit or 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.
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. This credit can apply towards a solar panel system installed on a primary or secondary residence that you own in the United States. 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 amount you can claim.
Wondering how the ITC applies to your specific situation? Contact your local Yankton solar panel installation expert to get more information.
The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar installations undertaken between January 1, 2022 and December 31, 2032. After this, the credit percentage will decrease slightly each year until the end of the program in 2035. 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 company.
State & Local Solar Incentives
There are often state solar incentives available in addition to federal ones. Tax credits, rebates and more might be available at a more local level. These incentives — which may be provided by your county or municipality, or by the state of South Dakota — could be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Yankton
Solar energy use nationwide has gone up significantly in the last 15 years, in part thanks to the proliferation of solar incentives. You can obtain these incentives from the federal government, the South Dakota government or your local utility company. We recommend talking to your local Yankton solar installer to learn more about these incentives and to make sure that you're getting the largest number possible for your solar panels.
EcoWatch's Yankton, SD Solar Incentives FAQs
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.