2025 Solar Incentives Guide for Howell, NJ - Tax Credits & Rebates

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

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

Solar incentives are meant to help mitigate the cost of installing solar panels on your home. Financial incentives like these are intended to encourage more homeowners to switch their home over to renewable energy. Incentives can include things like discounts, cash back or credit on your utility bill each month. Some incentives are provided by the federal government, while others are offered by the New Jersey government or your specific utility company, county or municipality. Some broad categories of solar incentives include:

• Tax Exemptions: Your solar panel system could qualify for both sales tax and property tax exemptions. Sales tax exemptions are applied at the time of purchase. Property tax exemptions allow you to ignore the added value of the solar panels when you are calculating property taxes on your house.
• Rebates: Solar rebates can be offered by your local utility company, or by your state or county. These rebates are essentially partial refunds that are applied after your purchase of solar panels and before tax credits are calculated.
• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives may be available to you if you have a solar system that produces over a specified (usually small) amount of electricity. This category of incentives is typically handled at the state level. You can sell the SRECs you receive to your utility company or other buyers, and the money you receive in return is usually considered part of your taxable income.
• Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
• Net Metering: You may be able to sign a net metering contract with your Howell utility company. This agreement may 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.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some familiarity with. One of the incentives that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a given 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. Originally, the tax credit was for 30% of the total cost – for panels, equipment, labor and accessories – although the percentage may range from 26-30%, depending on the installation date of your solar system. There is no cap on the amount you can claim.

Reaching out to your local Howell solar panel installer is the best way to understand how the ITC applies to you.

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. For solar system installations that begin after January 1, 2022, and are completed by the end of 2032, homeowners can apply for a credit equal to 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit ends in 2035. The program expansion also makes it easier to get credit for energy storage systems, starting in 2023.

Click here to learn more about the new Inflation Reduction Act. Your local Howell solar panel installation expert is the best person to answer your questions about the new Clean Energy Credit and how it applies to you.

State & Local Solar Incentives

Some solar incentives may be offered at the local or state level. As with federal incentives, these might include rebates, tax credits and more. Incentives may be offered by your county or municipality, or by the state of New Jersey. Some incentives might only be available for a limited time, while others are ongoing.

Next Steps for Installing Solar in Howell

There are many kinds of solar incentives: those offered by the federal government, those given by the New Jersey government and those provided by local utility companies, to name a few. The use of solar energy has grown enormously in the last 15 years, partially due to these incentives. Your local Howell solar panel installation expert can provide you with more details about which incentives you can apply for, and get you on track to switch to renewable energy today.