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

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

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

The phrase "solar incentives" refers broadly to financial incentives put in place by solar companies and the government to encourage people to use renewable energy by making installing and using solar panels more affordable. Various types of incentives, such as discounts, cash back or credit towards your monthly utility bill, might be available to you. Certain incentives may be handled by the New Jersey government, by your utility company or by county or municipality, while others are federal. You might qualify for any of the following types of solar incentives:

• Net Metering: Don't forget to talk to your Frankford 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 your solar panels generate. You could receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (This is different from a tax deduction.)
• Tax Exemptions: Your solar panel system might qualify for both sales tax and property tax exemptions. Sales tax exemptions are applied at the time of purchase. Property tax exemptions let you ignore the value that solar panels add when you are calculating property taxes on your home.
• Rebates: Solar companies may help you claim a rebate, or partial refund after purchase, for your solar system. States or counties will also sometimes offer limited-time rebates. The value of a rebate will usually be deducted from the total price before any tax credits are calculated.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives may be available to you if you have a solar system that produces over a specified (usually 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 make is typically considered part of your taxable income.

Federal Solar Incentives

When someone says "solar incentives," you probably think of federal incentives first. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a predetermined percentage of your solar system's cost.

The ITC is applied to the total cost of solar panel installation, including the panels themselves as well as equipment, accessories and labor. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence located in the United States that you own. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum amount you can claim.

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

In August 2022, the Inflation Reduction Act expanded and extended the ITC, now titled the Clean Energy Credit. The Clean Energy Credit is valid until 2035. Solar installation projects started after January 1, 2022 and completed by the end of 2032 may qualify for a 30% tax credit; the amount will then decrease slightly each year until the end of the current program. Beginning in 2023, it will also be easier to get credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. Your local Frankford solar panel installer can answer your questions and explain how the new Clean Energy Credit applies to you.

State & Local Solar Incentives

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

Next Steps for Installing Solar in Frankford

Solar incentives may come from your local utlity company, the New Jersey government or the federal government. The large number of solar incentives available has helped nationwide use of solar energy increase greatly in the last 15 years. Speak with your local solar panel installation company today to find out more information and to save the most money possible on solar panels for your Frankford home.