2025 Solar Incentives Guide for North Reading, MA - Tax Credits & Rebates

What Solar Tax Credits, Incentives, and Rebates are Available in North Reading?

Source: https://www.dsireusa.org/

The phrase "solar incentives" refers to a range of financial incentives implemented to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Incentives may include things like discounts, cash back or monthly utility bill credits. Some incentives are offered federally, while others are handled by the state of Massachusetts or by your specific utility company, county or municipality. Types of solar incentives might include:

• Solar Renewable Energy Certificate (SREC): SRECs can be sold to your utility company (or other buyers) for money that typically becomes part of your taxable income. In most cases, there is a small threshold of energy production to meet before your solar system is eligible for SRECs or other performance-based incentives. These kinds of incentives are generally handled by your state government.
• Rebates: A rebate is a partial refund given after you've purchased your solar system. These might be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
• Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
• Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar system. Property tax exemptions let you exclude the added value of your solar system when you calculate how much property tax you need to pay on your home.
• Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you have a net metering agreement with your North Reading utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some places, this is a dollar-for-dollar credit, while in other places you might receive a refund equivalent to a percentage of the value.

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 likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a percentage of the cost of your solar system.

The ITC originally covered 30% of the total cost of installing solar panels, 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 cost of installation includes the panels themselves as well as the cost of equipment, accessories and labor. There is no maximum claim amount. The ITC applies to solar systems installed after January 1, 2006, on your primary or secondary residence. The residence must be in the United States and owned by you.

Talking to your local North Reading solar panel installation expert is the best way to understand how the ITC could apply to your situation.

In August 2022, the ITC (now referred to as the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. The new Clean Energy Credit now runs until 2035. You are now eligible for a 30% credit for solar systems installed between 2022 and 2032. The credit will then decrease annually until the date of expiration. 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 fully understand how the new Clean Energy Credit will apply to you, reach out to your local North Reading solar installation company.

State & Local Solar Incentives

Tax credits, rebates and more can be claimed at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. Incentives might be handled by the state of Massachusetts, or by your county or municipality. Certain incentives are available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in North Reading

Solar incentives might be offered by the Massachusetts government, the federal government or your local utility company. The variety of solar incentives available has helped nationwide use of solar energy increase greatly in the last 15 years. Getting in touch with your local North Reading solar panel installation expert is the best first step towards making sure you get all the incentives you qualify for when you switch to solar energy.