2023 Solar Incentives Guide for Belleville, NJ - Tax Credits & Rebates

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

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

The phrase "solar incentives" refers to a range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. You may be eligible for various kinds of incentives, including discounts, cash back or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the New Jersey government and others from the federal government. Types of solar incentives might include:

• Rebates: A solar rebate is a partial refund after the purchase of 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 Exemptions: Tax exemptions may come in one of two forms. First, there is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption, which allows you to ignore the added value of your solar system when paying property tax on your house.
• Net Metering: Net metering factors in after your solar system is up and running. If you have a net metering agreement in place with your Belleville 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 may be refunded a percentage of the value.
• Tax Credits: Tax credits reduce, dollar-for-dollar, how much income tax you owe the government. These differ from tax deductions.
• Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce over a specific (usually small) amount of electricity can qualify for SRECs or other performance-based incentives. SRECs and performance-based incentives in general are typically given at the state level. When you receive an SREC, you can sell it to your utility company or another buyer, and generally the money you make is normally considered part of your taxable income.

Federal Solar Incentives

When people think of solar incentives, federal incentives are likely the first thing that comes to mind. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a predetermined percentage of the cost of your solar system.

The ITC was originally for 30% of the cost of installing a solar system, and has fluctuated slightly over the last few 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, labor and accessories. There is no maximum amount you can claim. The ITC can be applied 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.

Your local Belleville solar panel installation expert can offer more information about the ITC and how it may apply to your situation.

In August 2022, the ITC (now titled the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. The Clean Energy Credit runs until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit. This amount will decrease slightly on a yearly basis until the end of the current program. Beginning in 2023, it will also be easier to obtain credits for energy storage systems with the new act.

More information about the new Inflation Reduction Act can be found here. The easiest way to fully understand how the new Clean Energy Credit might apply to you is to talk with your local Belleville solar panel installation expert.

State & Local Solar Incentives

Some solar incentives are often also provided at the state and local level. Similar to federal incentives, these may include rebates, tax credits and more. Some incentives are ongoing, while others are available for a limited time. Solar incentives might be offered by the New Jersey government, or by your county or municipality.

Next Steps for Installing Solar in Belleville

There are a variety of solar incentives: those given by local utility companies, those given by the federal government and those given by the New Jersey government, to name a few. The use of solar energy has increased enormously in the last 15 years, partially due to these incentives. We recommend talking to your local Belleville solar installation expert for more information about these incentives and to be sure that you're getting the most money possible for your solar panels.