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

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

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. Incentives may include things like discounts, cash back or credit on your utility bill each month. Some incentives are offered federally, while others are handled by the state of New Jersey or by your utility company, county or municipality. You might qualify for any of the following types of solar incentives:

• Tax Exemptions: Tax exemptions can come in one of two forms. First, there is sales tax exemption, which is applied at the time you purchase your solar panels. The second is property tax exemption. This allows you to exclude the added value of your solar system when paying property tax on your home.
• Rebates: A solar rebate is a partial refund after the purchase of your solar system. These could be offered by your local utility company, your county or your state. The rebates are usually applied before tax credits are calculated.
• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
• Net Metering: Be sure to speak to your Fairview utility company about signing a net metering contract. This allows you to get a credit towards your monthly utility bill for the value of excess energy your solar panels generate. You could receive either a dollar-for-dollar credit or a percentage of the value.
• Solar Renewable Energy Certificate (SREC): SRECs can be sold to your utility company (or other buyers) for money that is generally considered part of your taxable income. In most cases, there is a small threshold of energy production to meet before your solar system qualifies for SRECs or other performance-based incentives. SRECs and similar incentives are typically handled by your state government.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some knowledge of. The solar incentive that you may be most familiar with is 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 can be credited towards 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. Initially, the ITC applied to 30% of all system costs (panels, equipment, accessories and labor), although the total amount has fluctuated slightly over the years 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.

Speaking with your local Fairview solar panel installation expert is the best way to learn more about how the ITC may apply to your situation.

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 has increased the current credit up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. After 2032, the credit percentage will see a slight decrease annually until the end of the program in 2035. Starting in 2023, it will also be easier to claim credits for energy storage systems under this new program.

Click here to learn more about the new Inflation Reduction Act. The best way to fully understand how the new Clean Energy Credit will apply to you is to reach out to your local Fairview solar panel installers with your questions.

State & Local Solar Incentives

Some solar incentives are often also provided by state and local governments. Like with federal incentives, these may include rebates, tax credits and more. These solar incentives — which may be provided by your county or municipality, or by the state of New Jersey — may be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Fairview

There are a number of different 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. Solar energy utilization has grown enormously in the last 15 years, thanks to these incentives. Reaching out to your local Fairview solar panel installation company is a great first step towards making sure you get all the incentives you qualify for when you switch to solar energy.