2025 Solar Incentives Guide for Bordentown, NJ - Tax Credits & Rebates

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

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

Solar incentives mitigate the cost of installing a solar panel system on your home. These financial incentives are intended to encourage more homeowners to switch to renewable energy. These incentives can include upfront discounts, cash back or monthly credits towards your utility bill. Some incentives are provided by the federal government, some by the state of New Jersey and some by your utility company, county or municipality. Categories of solar incentives include:

• Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
• Tax Exemptions: These could come in the form of property tax exemptions, which would allow you to ignore the value added by your solar panels when calculating the taxes you pay on your house. You could also look for exemptions on sales tax at the time of purchase.
• Rebates: Some solar companies will help you claim a rebate, or partial refund of your purchase, for your solar panels. States or counties will also offer limited-time rebates at various times. If you receive a rebate, that amount will usually come off your total price before tax credits are calculated.
• Net Metering: You may be able to sign a net metering agreement with your Bordentown utility company that will apply to all or a percentage of the excess electricity your solar panels generate. They will then deduct this value from your monthly utility bill.
• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are typically handled at the state level. Once your solar system meets a predetermined threshold (normally 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 receive is generally considered part of your taxable income.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some familiarity with. One of the incentives that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a given percentage of your solar system's cost.

The ITC originally covered 30% of the cost of installing a solar system, although that number has fluctuated slightly over time between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total installation cost includes the panels themselves as well as the cost of labor, accessories and equipment. There is no maximum claim amount. The ITC applies to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.

Your local Bordentown solar panel installer can give you more information about the ITC and how it might apply to your situation.

The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as renaming it to the Clean Energy Credit). The new Clean Energy Credit extends until 2035. Homeowners can now receive a 30% credit for solar systems installed between January 1, 2022, and December 31, 2032. The total credit will then see a slight annual decrease until it expires. The program expansion also makes credits for energy storage systems even easier to claim, beginning in 2023.

More information about the new Inflation Reduction Act can be found here. The easiest way to fully understand how the new Clean Energy Credit will apply to you is to get in touch with your local Bordentown solar panel installers.

State & Local Solar Incentives

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

Next Steps for Installing Solar in Bordentown

The variety of available solar incentives has contributed greatly to the increase in the adoption of solar energy nationwide over the past 15 years. You can get solar incentives from the federal government, the New Jersey government or from your local utility company. Your local Bordentown solar panel installer can help you learn more about which incentives you should apply for, and get you started on the path to switching to renewable energy today.