As new clean energy incentives arrive, we will update this info including time/date stamps within each updated section.
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The Department of Energy Savings Hub for Drivers offers information on clean vehicle incentives and eligibility.
Clean Vehicle Tax Credits must be initiated and approved at the time of sale. The tax credit may be provided in the form of cash, down payment, or partial payment for the EV.
NEW VEHICLES
You may qualify for a credit up to $7,500 if you buy a new, qualified plug-in EV or fuel cell electric vehicle. Your modified adjusted gross income may not exceed:
Find which new vehicles are eligible.
USED VEHICLE FEDERAL TAX CREDIT
You may qualify for a credit of up to $4,000 for qualified, previously-owned clean vehicles purchased in 2023 or after. Find which pre-owned vehicles are eligible.
MORE RESOURCES
Drive Electric Minnesota developed a database of available and upcoming electric vehicle and charging station incentives.
The Minnesota Electric Vehicle Rebate program opened in 2024 and is now closed.
Updated 4/17/2025
Households can capture a 30% tax credit, of up to $150 for a home energy audit.
Check with your gas or electric utility to see what home energy audits and related programs they have available.
NOTE to receive Residential Energy Tax Credits you'll submit IRS Form 5695 when filling your 2023-2032 taxes, if you meet the requirements detailed on IRS.gov.
Updated 4/17/2025
Through 2032, the overall total limit for an efficiency tax credit in one year is $3,200.
This breaks down to an annual limit of $1,200 for any combination of home envelope improvements (windows/doors/skylights, insulation, electrical) plus eligible furnaces, boilers, and central air conditioners.
Any combination of eligible heat pumps, heat pump water heaters, and biomass stoves/boilers are subject to an annual total limit of $2,000.
NOTE to receive Residential Energy Tax Credits you'll submit IRS Form 5695 when filling your 2023-2032 taxes, if you meet the requirements detailed on IRS.gov.
MORE TAX CREDIT RESOURCES
Updated 4/17/2025
Minnesota is currently designing its rebates programs and approaches with plans to open the programs to households in 2025. Stay up to date on rebates.
HOMES Rebates (Home Owner Managing Energy Savings) program is for energy saving improvements that impact the whole home or building. Households will be able to access up to $8,000 depending on amount of energy savings achieved and the household's income. Existing single-family homes and multifamily buildings will be eligible.
Home Electrification and Appliance Rebate Program (HEAR) will provide point-of-sales rebates to replace non-electric appliances with more efficient electric appliances, and to upgrade a home's electrical service to be ready for an increased electric demand. Up to $14,000 in rebates will be available to households with a total annual income less than 150% of the area median income. A few of the anticipated rebates include:
|
Electric Load Service Center upgrades/Breaker box - See the MN Residential Electrical Panel Grant Program for additional financial assistance. |
$4,000 |
| Electric Stove, Cooktop, Range, and/or Oven | $840 |
| Electric Wiring | $2,500 |
| Heat Pump Clothes Dryers | $840 |
|
Heat Pump Heating/Cooling - See the MN Residential Heat Pump Rebate Program for additional financial assistance. |
$8,000 |
| Heat Pump Water Heaters | $1,750 |
| Weatherization (Insulation, Air Sealing, Ventilation) | $1,600 |
MORE RESOURCES
Updated 4/17/2025
Tax credit of up to 30% of the cost for purchase (between Jan. 1, 2023 and Dec. 31, 2032) and installation of a heat pump, up to $2000.
The HEAR Rebate includes a point-of-sale rebate for people earning up to 150% of area median income that will apply to heat pumps, heat pump water heaters, and heat pump clothes dryers. The rebate has a $14,000 cap.
MORE RESOURCES
In addition to the Home Energy Rebates, the Minnesota Residential Heat Pump Rebate Program will provide financial assistance to eligible applicants that purchase and install a heat pump for space heating and cooling in the applicants’ Minnesota residence.
Visit MN Air Source Heat Pump Collaborative to learn more about product eligibility for tax credits, plus a list of Minnesota utilities and any rebates they offer for heat pumps.
Visit the ENERGY STAR Rebate Finder.
NOTE to receive Residential Energy Tax Credits you'll submit IRS Form 5695 when filling your 2023-2032 taxes, if you meet the requirements detailed on IRS.gov.
Updated 4/17/2025
30% tax credit for any project advanced in 2022 and will apply to projects through 2032. Projects with battery storage connected to and powered by solar also qualify.
As of 2023: Standalone residential energy storage systems >3 kW in capacity will also qualify for a 30% tax credit (they do not need to be connected to/powered by solar).
Additional grants will be available from MN's Energy Storage Incentives program.
NOTE to receive Residential Energy Tax Credits you'll submit IRS Form 5695 when filling your 2023-2032 taxes, if you meet the requirements detailed on IRS.gov.
Updated 4/17/2025
$2,500 available for ENERGY STAR certified manufactured homes meeting the most recent ENERGY STAR Manufactured New Homes program requirements (currently Version 2, with Version 3 to be implemented in 2026).
Updated 4/17/2025
Find details at IRS Commercial Clean Vehicle Credit.
Updated 1/9/2023
The USDA announced a pause in Inflation Reduction Act funded REAP applications [PDF]. They anticipate accepting REAP IRA applications later in 2025 ahead of the September 30 deadline.
Businesses must be located in rural areas with populations of 50,000 residents or less. Agricultural producers may be in rural or non-rural areas, must have at least 50% of their gross income coming from agricultural operations.
Updated 4/17/2025
The Investment Tax Credit was bumped up to 30% in 2023, and applies to projects less than 1 MW, or projects more than 1 MW which meet the prevailing wage and apprenticeship requirements. If a >1 MW project does not meet those requirements, the base credit is 6%.
There are credit adders that can be stacked for additional benefit:
Note: in 2025 the Investment Tax Credit and Production Tax Credit become the "Clean Electricity Investment Credit" (a technology-neutral incentive) and extends through 2032 or until emission targets are reached.
View IRS Credits and Deductions Under the Inflation Reduction Act
In addition to federal incentives, many businesses in Minnesota also have access to Property Assessed Clean Energy (PACE) financing for solar projects.
Updated 4/17/2025
179D was created in 2006 as an incentive for commercial building owners to install energy-efficient systems.
Prior to the IRA, a commercial building owner could get a tax deduction of $1.88/square foot if the renovation achieved 50% energy savings or the new construction was 50% more energy efficient over a standard energy benchmark.
The IRA lowered the required energy savings to 25% and set a sliding scale for the amount of the deduction available from $0.50/sq ft with 25% energy savings to $1/sq ft at 50% energy savings. If following prevailing wage and apprenticeship guidelines, the tax deduction can be up to $5/sq ft.
Updated 6/17/2024
Updated 4/17/2025
Updated 4/17/2025
Direct (Elective) Pay Fact Sheet for Nonprofits | Clean Energy Group (2024)
Updated 4/17/2025
179D was created in 2006 as an incentive for commercial building owners to install energy-efficient systems.
Section 179D eligibility was expanded under the IRA to include buildings owned by tax-exempt organizations who can allocate the tax deduction to the building's architect, engineer, or contractor that does pay taxes, making it a negotiation point on the cost of the project and they benefit from ongoing reduced utility bills.
The required energy savings is 25% and a sliding scale sets the amount of the deduction available from $0.50/sq ft with 25% energy savings to $1/sq ft at 50% energy savings. If following prevailing wage and apprenticeship guidelines, the tax deduction can be up to $5/sq ft.
Nonprofits should get guidance from qualified professionals:
Updated 6/17/2024
Find the most recent news and updates to tax law.
Minnesota Department of Commerce programs offering grants, rebates, and other funding opportunities.
Tax credit and rebates listed for each appliance, EV, and home improvement option.
Lists clean energy incentives based on your zip code, including utility rebates.
Free tool to estimate how much money you could save with the IRA.
Note: We're sharing resources to assist Minnesotans who are seeking information about federal funding opportunities. These resources are based on preliminary information released by the federal government. Program information may change as more guidance is provided by federal and state governments. For specific information on federal funding, please visit the relevant U.S. Government websites and consult with tax professionals regarding tax incentives that apply to you.
