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

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

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

The phrase "solar incentives" includes a 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. Incentives may include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are provided by the federal government, while others are handled by the state of New Jersey or your utility company, county or municipality. Some solar incentives you might qualify for are:

• Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives may be available to you if you have a solar system that produces over a specified (generally small) amount of electricity. These types of incentives are generally handled by the state government. You can sell the SRECs you receive to your utility company or other buyers, and the money you receive in return is normally considered part of your taxable income.
• Net Metering: Don't forget to speak to your Jefferson utility company about signing a net metering agreement. This allows you to receive credit towards your monthly utility bill for the value of excess energy your solar panels generate. You may receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (This is different from a tax deduction.)
• Tax Exemptions: Tax exemptions can come in one of two forms. First, there is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption. This allows you to exclude the value added by your solar system when paying property tax on your home.
• Rebates: Solar rebates can be offered by your state or county, or by your local utility company. These rebates are essentially partial refunds that are applied after your purchase of solar panels and before tax credits are calculated.

Federal Solar Incentives

When you think about solar incentives, you likely think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is likely the best-known federal solar incentive. The ITC provides you with a tax credit for a predetermined percentage of your solar system's cost.

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

Your local Jefferson solar panel installer can give you more information about the ITC and how it may apply to your situation.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now referred to as the Clean Energy Credit. The new Clean Energy Credit now runs until 2035. Homeowners 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. This credit will then decrease annually until the date of expiration. Beginning in 2023, it will also be easier to get credits for energy storage systems under the new laws.

Click here to learn more about the new Inflation Reduction Act. Your local Jefferson 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

Some solar incentives are often also provided by state and local governments. Similar to federal incentives, these could include tax credits, rebates and more. Certain incentives are offered for only a limited time, while others are ongoing. Your local solar incentives could come from your county or municipality, or from the New Jersey government.

Next Steps for Installing Solar in Jefferson

There are a number of different solar incentives: those provided by local utility companies, those given by the federal government and those offered by the New Jersey government, to name a few. The use of solar energy has increased tremendously in the last 15 years, thanks to these incentives. We suggest talking to your local Jefferson solar installation company to learn more about these incentives and to ensure that you're getting the largest number possible for your solar system.