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

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

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

Solar incentives are designed to make renewable energy usage more affordable via financial incentives for individuals who install solar panels on their homes. You might qualify for different types 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 state of New Jersey and others from the federal government. Some broad categories of solar incentives include:

• Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
• Solar Renewable Energy Certificate (SREC): SRECs can be sold to your utility company (or other buyers) for cash that is generally considered part of your taxable income. In most cases, you must meet a certain (small) threshold of energy production before your solar system qualifies for SRECs or similar performance-based incentives. Incentives like these are normally handled at the state level.
• Rebates: Solar rebates can be provided by your local utility company, or by your county or state. These rebates are essentially partial refunds that are applied after your purchase of solar panels and before tax credits are calculated.
• Net Metering: You may be able to sign a net metering agreement with your Edgewater Park utility company. This agreement may apply to all or a percentage of the excess electricity your solar panels generate. They will then deduct this value from your utility bill each month.
• Tax Exemptions: Sales tax exemptions go into effect at the point of sale for your solar system. Property tax exemptions allow you to exclude the value that your solar panels add when calculating how much property tax you need to pay on your home.

Federal Solar Incentives

When you hear the term "solar incentives," federal incentives are likely the first thing that comes to mind. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a predetermined percentage of your solar system's cost.

The ITC applies to the value of a solar system installed on your primary or secondary residence in the United States. The solar panels have to have been installed on a property you own after January 1, 2006 for you to claim the credit. Originally, the ITC covered 30% of all system installation costs (panels, accessories, equipment and labor), although the total amount has fluctuated over time between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the claim amount.

Wondering how the ITC applies to your specific situation? Contact your local Edgewater Park solar panel installer to get more information.

In August 2022, the ITC (now titled the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. 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. This amount will be decreased slightly each year until the current program ends. The program expansion also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.

Click here to learn more about the new Inflation Reduction Act. The best way to understand how the new Clean Energy Credit will apply to you is to talk with your local Edgewater Park solar panel installation expert.

State & Local Solar Incentives

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

Next Steps for Installing Solar in Edgewater Park

You can receive solar incentives from the New Jersey government and the federal government, as well as from your local utility company. This increase in availability of solar initiatives in the past 15 years has helped increase solar adoption nationwide. Getting in touch with your local Edgewater Park solar panel installation expert is an excellent first step towards getting the most money possible when you switch to solar energy.