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

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

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

The phrase "solar incentives" refers to a wide range of financial incentives put in place to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Different kinds of incentives, such as discounts, cash back or monthly utility bill credits, may be available to you. Some incentives may be provided via the state of New Jersey, by your utility company or by county or municipality, while other incentives are federal. Some solar incentives you might qualify for are:

• Rebates: Rebates, or cash back after a purchase, are usually applied before any solar tax credits are calculated. Solar rebates may be given by your local utility company, by your state or by your county.
• Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives might be available to you if you have a solar system that produces more than a specified (usually small) amount of electricity. Performance-based incentives are normally handled by the state government. You can sell any SRECs you have to your utility company or other buyers, and the money you receive in return is normally considered part of your taxable income.
• Net Metering: Net metering is an incentive you can get once your solar panels are up and running. If you have a net metering agreement in place with your Hopewell utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in other areas you might be refunded a percentage of the value.
• Tax Exemptions: Sales tax exemptions are applied at the time of purchase for your solar panels. Property tax exemptions allow you to exclude the value that your solar panels add when you calculate the amount of property tax you need to pay.

Federal Solar Incentives

Federal solar incentives are likely to be the first thing that comes to mind when you think about solar incentives. One of the incentives many people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a specific percentage of the cost of your solar system.

The ITC can be applied to solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, accessories, labor and equipment. You can receive this credit for solar panels 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.

Have questions about how the ITC applies to your specific situation? Contact your local Hopewell solar panel installer to get more information.

The ITC has been renewed and expanded following the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The Clean Energy Credit re-raises the credit up to 30% for solar installations undertaken between January 1, 2022 and December 31, 2032. At this point, the percentage will be reduced slightly each year until the program expires in 2035. Starting in 2023, the expansion to the program will also make credits for energy storage systems even easier to claim.

More information about the new Inflation Reduction Act can be found here. The easiest way to understand how the new Clean Energy Credit applies to you is to reach out to your local Hopewell solar panel installation expert with your questions.

State & Local Solar Incentives

In addition to federal solar incentives, there are often also state ones. Rebates, tax credits and more might be available at a more local level. These incentives might be provided by the New Jersey government, or by your county or municipality. Some are ongoing, while others are available for a limited time.

Next Steps for Installing Solar in Hopewell

The variety of available solar incentives has helped tremendously increase the nationwide adoption of solar energy over the last 15 years. You might qualify for solar incentives from your local utility company, the New Jersey government or the federal government. It is a good idea to talk to your local Hopewell solar installation expert for more information about these incentives and to be sure that you're getting the most money possible for your solar system.