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

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

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

Solar incentives are designed to mitigate the cost of installing a solar panel system on your home. Financial incentives like these are intended to encourage more homeowners to switch to renewable energy. You may be eligible for different types of incentives, including discounts, cash back or credit towards your monthly utility bill, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the New Jersey government and others from the federal government. Some solar incentives you might qualify for are:

• Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the federal government. (This is different from a tax deduction.)
• Tax Exemptions: These may come in the form of property tax exemptions, which can let you exclude the value added by your solar panels when calculating the taxes you pay on your house. They may also include exemptions on sales tax at the time of purchase.
• Solar Renewable Energy Certificate (SREC): In most cases, solar systems that produce more than a predetermined (normally small) amount of electricity can qualify for SRECs or other performance-based incentives. SRECs and the like are typically provided by your state government. When you receive an SREC, you can sell it to your utility company or another buyer, and this is usually considered part of your taxable income.
• Net Metering: Net metering becomes relevant after your solar system is up and running. If you have in place a net metering agreement with your Linden utility company, it will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some locations, this credit is dollar-for-dollar, while in other areas you may make back a percentage of the value.
• Rebates: Your solar installer might help you claim a rebate, or partial refund of your purchase, for your solar panels. States or counties will also offer limited-time rebates at various times. The value of a rebate will usually come off your total price before tax credits are calculated.

Federal Solar Incentives

When thinking about solar incentives, you likely think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC offers a tax credit for a predetermined percentage of the cost of your solar system.

The ITC can be applied to a solar system installed on your primary or secondary residence in the United States. The solar panels must have been installed after January 1, 2006 on a property owned by you for you to be eligible for the credit. Initially, the ITC applied to 30% of all system costs (panels, equipment, labor and accessories), although the total amount has fluctuated slightly over the years between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the amount you can claim.

To best understand how the ITC might apply to you, speak to your local Linden solar panel installer and request 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. For solar systems installed between January 1, 2022 and December 31, 2032, homeowners may be eligible for a credit for 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems under the new laws.

Click here to learn more about the new Inflation Reduction Act. To better understand how the new Clean Energy Credit will apply to you, reach out to your local Linden solar installation company.

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. Some incentives are ongoing, while others may only be available for a limited time. These incentives might be offered by your county or municipality, or by the New Jersey government.

Next Steps for Installing Solar in Linden

You can qualify for solar incentives from the federal government and the New Jersey government, as well as from your local utility company. The growing availability of solar initiatives in the past 15 years has helped increase nationwide solar energy use enormously. Your local Linden solar panel installer can help you learn more about which incentives you should apply for, and get you started on the path to switching to renewable energy today.