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

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

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

Solar incentives are intended to make renewable energy usage more affordable through financial incentives to help people install solar panels on their homes. Different types of incentives, like cash back, discounts or credit towards your monthly utility bill, might be available to you. Some incentives may be provided via the New Jersey government, by your utility company or by county or municipality, while other incentives are federal. Some broad categories of solar incentives include:

• Rebates: Some solar companies will help you claim a rebate, or partial refund after purchase, for your solar system. States or counties will also offer limited-time rebates at various times. The value of a rebate will usually be deducted from the total price before tax credits are calculated.
• Tax Credits: Tax credits reduce, dollar-for-dollar, the total amount of tax you owe the federal government. Tax credits differ from tax deductions.
• Tax Exemptions: Tax exemptions can come in two forms. The first is sales tax exemption, 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 calculating property tax for your home.
• Net Metering: You may be able to sign a net metering contract with your Hackettstown utility company. This agreement may apply to all or a percentage of the excess electricity your solar panels generate. Your utility company will then subtract this value from your utility bill each month.
• Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce over a specific (normally small) amount of electricity will qualify for SRECs or other performance-based incentives. SRECs and similar incentives are typically given by your state government. You can sell SRECs to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.

Federal Solar Incentives

When someone says "solar incentives," you probably think of federal incentives first. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit equal to a predetermined percentage of the money you spend installing solar panels.

The ITC applies towards solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, equipment, accessories and labor. You can claim this credit for a solar panel system installed on a primary or secondary residence that you own in the United States. The original claim amount was 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum claim amount.

To find out exactly how much money the ITC could save you, contact your local Hackettstown solar panel installation expert.

In August 2022, the ITC (now referred to as the Clean Energy Credit) was expanded and extended by the passage of the Inflation Reduction Act. The new Clean Energy Credit extends until 2035. Homeowners are now eligible for a 30% credit for solar systems installed between 2022 and 2032. This new credit will then decrease annually until its expiration. The expansion to the program also makes credits for energy storage systems even easier to claim, starting in 2023.

More information about the new Inflation Reduction Act can be found here. Your local Hackettstown 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

Tax credits, rebates and more can be claimed at multiple levels. Along with federal solar incentives, there are often state and local ones as well. These incentives may be handled by the New Jersey government, or by your county or municipality. Certain incentives are ongoing, while others are available for a limited time.

Next Steps for Installing Solar in Hackettstown

Nationwide solar energy use has increased enormously in the last 15 years, in part due to the growth in the number of solar incentives. You might receive these incentives from the New Jersey government, the federal government or your local utility company. Reaching out to your local Hackettstown solar panel installation company is a great first step towards getting the most money possible when you switch to solar energy.