2025 Solar Incentives Guide for Watertown, WI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Watertown.
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 Watertown?
Renewable Energy Sales Tax Exemptions
Renewable Rewards Program
Business - 0-5 kW: $200 per kW
5-10 kW: $1000 + $150 per kW over 5
10-100 kW: $1750 + $125 per kW over 10
100-300 kW: $13000 + $100 per kW over 100
300-500 kW: $33000 + $85 per kW over 300
Biogas, Solar, and Wind Energy Equipment Exemption
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are intended to encourage homeowners to switch their home over to renewable energy by offering incentives that lower the financial burden of solar panel installation and use. You may be eligible for various types of incentives, including cash back, discounts or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of Wisconsin and others from the federal government. Some solar incentives you might qualify for are:
- Tax Exemptions: Tax exemptions can come in one of two forms. First, there is sales tax exemption, applied at the time you purchase your solar panels. The second is property tax exemption. This allows you to ignore the value added by your solar system when paying property tax on your home.
- Net Metering: You may be able to sign a net metering contract with your Watertown utility company that will apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then deduct this value from your monthly utility bill.
- Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the federal government. (A tax credit is different from a tax deduction.)
- Rebates: Rebates, or partial refunds after a purchase, are typically applied before any solar tax credits are calculated. These rebates may be given by your local utility company, by your state or by your county.
Federal Solar Incentives
Federal solar incentives are likely the first thing that you think of when you think about solar incentives. 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 certain percentage of the cost of your solar system.
The ITC was originally for 30% of the cost of solar system installation, although it has fluctuated slightly over the last few years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total installation cost includes the panels themselves as well as the cost of labor, equipment and accessories. There is no maximum claim amount. The ITC can be applied to solar systems installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.
To know exactly how much the ITC could save you, speak with your local Watertown solar panel installation expert.
The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. Now, solar installation projects that are completed between 2022 and 2032, may be eligible for a 30% tax credit. The amount of the credit will then see a slight annual decrease until the end of the current Clean Energy Credit in 2035. Beginning in 2023, it will also be easier to qualify for credits for energy storage systems under this new program.
More information about the new Inflation Reduction Act can be found here. Your local Watertown solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it applies to you.
State & Local Solar Incentives
Some solar incentives may be offered at the local or state level. Similar to federal incentives, these may include tax credits, rebates and more. The incentives — which might be handled by your county or municipality, or by the state of Wisconsin — could be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Watertown
Solar incentives might be provided by the Wisconsin government, the federal government or your local utility company. The growing number of available incentives has contributed to a large increase in solar energy use in the last 15 years. Talking to your local Watertown solar panel installer is the best first step towards getting the most money possible when you switch to solar energy.
EcoWatch's Watertown, WI Solar Incentives FAQs
My home already has solar panels. Are there any incentives that I qualify for?
You should plan to talk to the company that installed your system – or reach out to a local Watertown solar installer — to clarify which incentives you may qualify for. If your system was installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
How long until the federal solar tax credit ends?
The federal solar tax credit, formerly called the ITC and now titled the Clean Energy Credit, is scheduled 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.
If I switch my appliances out for ones that can utilize solar energy, are there credits I can claim?
The recently passed Inflation Reduction Act introduces multiple incentives that reward homeowners for making eco-friendly upgrades. Some of these incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.
Can I receive incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can claim both rebates and tax credits towards the cost of solar panels. Depending on which incentives you are eligible for, they may apply in a different order. Be sure to speak with your solar installer or a local tax professional to ensure that you are claiming incentives correctly and that you're getting the most money possible.
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