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

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

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

The term "solar incentives" refers to a range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Various kinds of incentives, such as cash back, discounts or monthly utility bill credits, may be available to you. Certain incentives may be offered by the state of New Jersey, by your utility company or by county or municipality, while other incentives are federal. Categories of solar incentives include:

• Tax Credits: Tax credits reduce, dollar-for-dollar, how much income tax you owe the federal government. Tax credits differ from tax deductions.
• Net Metering: You can sign a net metering contract with your Leonia utility company that will apply to all or a percentage of the excess electricity your solar panels generate. Your utility company will then deduct this value from your utility bill each month.
• Tax Exemptions: Sales tax exemptions are applied at the point of sale for your solar system. Property tax exemptions allow you to ignore the added value of your solar system when you calculate the amount of property tax you need to pay on your house.
• Solar Renewable Energy Certificate (SREC): In general, solar systems that produce more than a predetermined (normally small) amount of electricity will qualify for SRECs or other performance-based incentives. SRECs and similar incentives are typically provided at the state level. You can sell SRECs to your utility company or another buyer, and generally the money you make is normally considered part of your taxable income.
• Rebates: A solar rebate is a partial refund after the purchase of your solar system. Rebates may be offered by your local utility company, your state or your county. The rebates are usually applied before calculating tax credits.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some knowledge 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 specific percentage of your solar system's cost.

The ITC is applied to the total cost of installing a solar system, including the panels themselves as well as accessories, labor and equipment. You can claim this credit for panels installed after January 1, 2006 on a primary or secondary residence that you own, as long as it is located in the United States. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum amount you can claim.

Wondering how the ITC applies to your specific situation? Contact your local Leonia solar panel installer to get more information.

In August 2022, the ITC (now referred to as the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. The new Clean Energy Credit now runs until 2035. American homeowners are now eligible for a 30% credit for solar systems installed between 2022 and 2032. This credit will then see a slight annual decrease until the date of expiration. The 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. The best way to understand how the new Clean Energy Credit might apply to you is to reach out to your local Leonia solar panel company with your questions.

State & Local Solar Incentives

There are more than just federal solar incentives; rebates, tax credits and more might also be offered at the local or state level. These solar incentives — which may be handled by your county or municipality, or by the state of New Jersey — might be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Leonia

The nationwide use of solar energy has gone up significantly in the last 15 years, in part due to the growth in the number of solar incentives. You might receive these incentives from the New Jersey government, the federal government or your local utility company. Reach out to your local solar panel installation expert today to find out more information and to save as much money as possible on solar panels for your Leonia home.