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

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

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

Solar incentives are intended to make renewable energy usage more affordable via financial incentives for those who install solar panels on their homes. Various kinds of incentives, like cash back, discounts or monthly utility bill credits, may 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. Some broad categories of solar incentives include:

• Tax Exemptions: Your solar system might 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 that solar panels add when calculating property taxes on your house.
• Rebates: Solar companies may help you claim a rebate, or partial refund after purchase, for your solar panels. States or counties will also offer limited-time rebates at various times. If you receive a rebate, that amount will usually come off your total price before any tax credits are calculated.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are normally handled at the state level. Once your solar system meets a predetermined threshold (typically a small amount of energy production), you are eligible to receive SRECs that you can then sell to your utility company or other buyers. The money you make is generally considered part of your taxable income.
• Net Metering: You can sign a net metering contract with your Hopatcong utility company that will apply to all or a percentage of the excess electricity that is generated by your solar panels. Your utility company will then subtract this value from your monthly utility bill.
• Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have heard of. One of the incentives many people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a specified percentage of your solar system's cost.

The ITC initially applied to 30% of the cost of solar panel installation, and has fluctuated slightly over the last few years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total installation cost includes the panels themselves as well as the cost of labor, equipment and accessories. There is no maximum amount you can claim. The ITC applies to solar panels installed after January 1, 2006 on your primary or secondary residence. The residence must be owned by you and in the United States.

To better understand how the ITC will apply to you, contact your local Hopatcong solar panel installer and request more information.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now called the Clean Energy Credit. The Clean Energy Credit runs 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 on a yearly basis until the current program ends. Starting in 2023, it will also be easier to obtain credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. Your local Hopatcong solar panel company can answer any questions you have and explain how the new Clean Energy Credit 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 as well. These incentives might be provided 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 Hopatcong

The nationwide use of solar energy has gone up tremendously in the last 15 years, in part due to the increase in availability of solar incentives. You may get these incentives from your local utility company, the New Jersey government or the federal government. Getting in touch with your local Hopatcong solar panel installation expert is the right first step towards making sure you get all the incentives you qualify for when you switch to solar energy.