Solar Guide

Indiana’s Property Tax Exemption allows homeowners with solar, wind, geothermal, or hydroelectric systems to reduce their annual property taxes by deducting the full assessed value of their renewable energy equipment. This means if your solar system adds $5,000 to your home’s assessed value, you can deduct that entire $5,000 from your property tax calculation each year, resulting in ongoing tax savings.

The incentive is available to homeowners, renters (lessees), and contract buyers who install qualifying renewable energy devices. Once approved, the deduction automatically continues each year without needing to reapply, making it a long-term benefit. Applications must be filed by January 5th each year using Form SES/WPD, and can be submitted by email, in-person, or regular mail (postmark deadline applies). For geothermal and hydroelectric systems, you’ll need additional certification from the Indiana Department of Environmental Management before applying for the tax deduction.

Indiana’s Sales Tax Exemption allows certain businesses and organizations to purchase solar equipment without paying the state’s sales tax. This exemption uses a standard state form (ST-105) that covers various types of tax-exempt purchases, including solar installations for qualifying buyers. The financial benefit equals the full amount of Indiana’s sales tax that would normally be charged on solar equipment purchases.

To qualify for this exemption, you must be a registered business with either an Indiana Taxpayer Identification Number (TID) or a valid business license from another state. The exemption is primarily designed for retailers, wholesalers, manufacturers, contractors working on exempt projects, government entities, and certain other business categories. Individual homeowners purchasing solar panels for personal use typically do not qualify for this business-focused exemption. The form must be completed in full with proper identification numbers, signatures, and exemption justification, and the seller must keep the certificate on file to support the tax-exempt sale.

Net metering in Indiana is a billing arrangement that allows homeowners with solar panels to receive credit for the excess electricity they generate and send back to the power grid. When your solar system produces more energy than your home uses during sunny periods, that extra power flows to the grid and your electric meter essentially runs backward, creating credits on your utility bill.

The financial benefit works like a one-to-one credit system – for every kilowatt-hour (kWh) of excess solar energy you send to the grid, you receive a credit equal to the retail rate you normally pay for electricity from your utility company. These credits can then be used to offset the electricity you draw from the grid when your solar panels aren’t producing enough power, such as at night or during cloudy days. This arrangement can significantly reduce or even eliminate your monthly electric bill, depending on your solar system size and energy usage patterns.

To be eligible for net metering in Indiana, you must have a qualifying renewable energy system installed at your home and receive approval from your utility company. The program is available to residential customers, though specific requirements and system size limits may vary by utility provider. It’s important to contact your local utility company before installing solar panels to understand their specific net metering policies and interconnection procedures.