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

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

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

Solar incentives are intended to make renewable energy usage more affordable via financial incentives for individuals who install solar panels on their homes. Different kinds of incentives, such as discounts, cash back or monthly utility bill credits, might be available to you. Some incentives may be handled by the Massachusetts government, by your utility company or by county or municipality, while others are federal. Types of solar incentives might include:

• Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
• Rebates: Solar companies may help you claim a rebate, or partial refund after purchase, for your solar panels. States or counties will also offer limited-time rebates at various times. Any rebates you receive will usually be deducted from the total price before any tax credits are calculated.
• Net Metering: Net metering is an incentive you can get once your solar system is up and running. If you've signed a net metering agreement with your Northborough utility company, the company will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in other areas you may receive a refund equivalent to a percentage of the value.
• Solar Renewable Energy Certificate (SREC): SRECs and other similar performance-based incentives are generally handled by your state government. Once your solar system meets a predetermined threshold (typically a small amount of energy production), you can receive SRECs that can then be sold to your utility company or other buyers. The money you make is usually considered part of your taxable income.
• Tax Exemptions: Sales tax exemptions are effective at the point of sale for your solar system. Property tax exemptions allow you to ignore the value added by your solar system when calculating how much property tax you need to pay on your house.

Federal Solar Incentives

Federal solar incentives are likely to be the first thing that you think of when you think about solar incentives. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit that reduces your taxes by a certain percentage of the money you spend on solar panels for your home.

The ITC initially applied to 30% of the cost of solar panel installation, although that number has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total installation cost includes the panels themselves as well as the cost of equipment, accessories and labor. There is no maximum amount you can claim. The ITC can be applied to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be in the United States and owned by you.

Curious how the ITC might apply to your specific situation? Reach out to your local Northborough solar panel installation expert to get more information.

The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The new Clean Energy Credit now runs until 2035. American homeowners are now eligible for a 30% credit for solar systems that began installation after January 1, 2022, and are completed by the end of 2032. This credit will then see a slight annual decrease until it expires. 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 Northborough solar panel installation experts can answer your questions and explain how the new Clean Energy Credit may apply to you.

State & Local Solar Incentives

Some solar incentives are often also provided at the state and local level. Like with federal incentives, these could include rebates, tax credits and more. Some incentives are ongoing, while others are only available for a limited time. Incentives may be offered by your county or municipality, or by the Massachusetts government.

Next Steps for Installing Solar in Northborough

There are a number of different solar incentives: those provided by local utility companies, those provided by the federal government and those provided by the Massachusetts government, to name a few. Solar energy use has increased enormously in the last 15 years, partially thanks to these incentives. Speaking with your local Northborough solar panel installer is the right first step towards making sure you get all the incentives you qualify for when you switch to solar energy.