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

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

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

Solar incentives encourage homeowners to switch to renewable energy by providing incentives that lower the financial burden of solar panel installation and use. Incentives might include things like discounts, cash back or credit on your utility bill each month. Some incentives are offered by the federal government, while others are offered by the New Jersey government or your utility company, county or municipality. Some broad categories of solar incentives include:

• Tax Exemptions: Tax exemptions can come in one of two forms. The first is sales tax exemption, which is 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.
• Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives might be available to you if you have a solar system that produces over a specified (typically small) amount of electricity. These types of incentives are normally handled at the state level. You can sell SRECs to your utility company or other buyers, and the money you receive in return is generally considered part of your taxable income.
• Net Metering: Be sure to speak to your Clark utility company about signing a net metering agreement. This will allow you to get a credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You might receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
• Rebates: A solar rebate is a partial refund after the purchase of your solar system. These may be offered by your local utility company, your county or your state. The cash back that you get from the rebates is normally applied before calculating tax credits.

Federal Solar Incentives

When thinking about solar incentives, you probably think of federal incentives first. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a specified percentage of your solar system's cost.

The ITC initially applied to 30% of the cost of installing a solar system, and has fluctuated slightly over the years 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 in the United States and owned by you.

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

In August 2022, the ITC (now called the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. The Clean Energy Credit runs 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 decrease slightly on a yearly basis until the current program ends. The expansion to the program also makes credits for energy storage systems even easier to claim, starting in 2023.

Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit will apply to you, reach out to your local Clark solar installation company.

State & Local Solar Incentives

Some solar incentives may be provided by state and local governments. Similar to federal incentives, these can include tax credits, rebates and more. Incentives might be provided 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 Clark

There are many types of solar incentives: those provided by the federal government, those given by the New Jersey government and those given by local utility companies, to name a few. Solar energy utilization has grown enormously in the last 15 years, thanks to these incentives. We suggest talking to your local Clark solar installation company to learn more about these incentives and to ensure that you're getting the largest number possible for your solar system.