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

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

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

Solar incentives are designed to mitigate the cost of installing a solar panel system on your home. This category of financial incentives is intended to encourage more Americans to make the switch to renewable energy. You might be eligible for several types of incentives, including cash back, discounts or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of New Jersey and others from the federal government. You might qualify for any of the following types of solar incentives:

• Net Metering: Don't forget to talk with your Ho Ho Kus utility company about signing a net metering contract. This allows you to get a credit towards your utility bill every month for the value of excess energy generated by your solar panels. You may receive either a dollar-for-dollar credit or a percentage of the value.
• Rebates: A rebate is a partial refund credited to your account after you've paid for your solar system. These could be offered by your local utility company, your county or your state. The rebates are usually applied before calculating tax credits.
• Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (This is different from a tax deduction.)
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives might be available to you if the solar system on your home produces more than a specified (usually small) amount of electricity. This category of incentives is usually handled by the state government. You can sell SRECs to your utility company or other buyers, and the money you receive in return is usually considered part of your taxable income.
• Tax Exemptions: Your solar panels may qualify for both sales tax and property tax exemptions. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions allow you to ignore the value added by your solar panels when calculating property taxes on your house.

Federal Solar Incentives

Federal solar incentives are likely the first thing that you think of when you think about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is probably the best-known federal solar incentive. The ITC allows you to claim a tax credit for a specific percentage of the cost of your solar system.

The ITC applies to solar systems installed after January 1, 2006 on a primary or secondary residence that you own in the United States. The credit initially covered 30% of the total cost — for panels, equipment, labor and accessories — although the percentage may range from 26-30%, depending on when your solar system was installed. There is no cap on the amount you can claim.

To better understand how the ITC will apply to your situation, reach out to your local Ho Ho Kus solar panel installation expert and request more information.

The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as retitling it the Clean Energy Credit). The new Clean Energy Credit is valid until 2035. You can now apply for a 30% credit for solar systems that began installation after January 1, 2022 and are completed by the end of 2032. The total credit will then be decreased by a few percentage points every year until it expires. Starting in 2023, the program expansion will also make it easier to get credit for energy storage systems.

More information about the new Inflation Reduction Act can be found here. Your local Ho Ho Kus solar panel installers are the best people to answer your questions about the new Clean Energy Credit and how it will apply to you.

State & Local Solar Incentives

Tax credits, rebates and more can be claimed at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. Some incentives are ongoing, while others are available for a limited time. Incentives might be given by your county or municipality, or by the New Jersey government.

Next Steps for Installing Solar in Ho Ho Kus

Solar incentives might come from your local utlity company, the New Jersey government or the federal government. The large number of solar incentives available has contributed to a large increase in solar energy use in the last 15 years. When you're prepared to make the switch to solar energy, reaching out to your local Ho Ho Kus solar panel installation expert is an excellent place to start.