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

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

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

The phrase "solar incentives" refers to a wide 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. You might qualify for various kinds of incentives, including discounts, cash back or credit towards your monthly utility bill, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of New Jersey and others from the federal government. Categories of solar incentives include:

• Rebates: A rebate is a partial refund after the purchase of your solar system. Rebates could be offered by your local utility company, your county or your state. The rebates are usually applied before calculating tax credits.
• Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
• Net Metering: Net metering becomes relevant after your solar system is up and running. If you've signed a net metering agreement with your Brick 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 areas, this is a dollar-for-dollar credit, while in other places you may make back a percentage of the value.
• Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce over a threshold (generally small) amount of electricity can qualify for SRECs or other similar performance-based incentives. SRECs and the like are typically given by your state government. SRECs can be sold to your utility company or another buyer, and generally the money you make is normally considered part of your taxable income.
• Tax Exemptions: These could come in the form of property tax exemptions, which can let you exclude the value added by your solar panels when paying property tax on your home. They may also include exemptions on sales tax at the time of purchase.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have heard of. An incentive that most people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a given percentage of the cost of your solar system.

The ITC applies to the total cost of installing a solar system, including the panels themselves as well as equipment, labor and accessories. You can claim this credit for panels installed after January 1, 2006 on a primary or secondary residence that you own, as long as it is located in the United States. The tax credit ranges from 26-30% of total costs depending on when your project was completed. There is no maximum amount you can claim.

To find out exactly how much the ITC could save you, contact your local Brick solar panel installer.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now referred to as the Clean Energy Credit. The Clean Energy Credit lasts until 2035. Any solar installation project that is completed between January 1, 2022 and December 31, 2032 may qualify for a 30% tax credit; the amount will then decrease slightly each year until the end of the current program. Starting in 2023, the expansion to the program will also make it easier to get credit for energy storage systems.

More information about the new Inflation Reduction Act can be found here. Your local Brick solar panel company is the best resource for answering your questions about the new Clean Energy Credit and how it applies to you.

State & Local Solar Incentives

There are often also state solar incentives in addition to those provided by the federal government. Rebates, tax credits and more may be available at a more local level. Incentives might be given by your county or municipality, or by the state of New Jersey. Some incentives are available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in Brick

Solar incentives might come from the New Jersey government, the federal government or your local utility company. The growing number of available incentives has facilitated the nationwide growth of solar energy use in the last 15 years. It is a good idea to talk to your local Brick solar installation expert for more information about these incentives and to make sure that you're getting all of the money you can for your solar panels.