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

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

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

The term "solar incentives" generally refers to financial incentives designed to encourage the adoption and use renewable energy by making the installation and use of solar panels more affordable. You might qualify for different kinds 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. You might qualify for any of the following types of solar incentives:

• Tax Exemptions: Your solar panel system may qualify for both sales tax and property tax exemptions. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions allow you to ignore the value added by your solar panels when calculating property taxes on your home.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives might be available to you if your solar system produces over a specified (generally small) amount of electricity. This category of incentives is typically handled by the state government. You can sell any SRECs you have to your utility company or other buyers, and the money you make is normally considered part of your taxable income.
• Net Metering: Net metering becomes relevant once your solar panels are up and running. If you have in place a net metering agreement with your Lopatcong utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this credit is dollar-for-dollar, while in others you might receive a refund equivalent to a percentage of the value.
• Rebates: Some solar companies will help you claim a rebate, or partial refund after purchase, for your solar panels. States or counties will also sometimes offer limited-time rebates. The value of a rebate will usually be deducted from the total price before tax credits are calculated.
• Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some familiarity with. You might have heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a certain percentage of the money you spend installing solar panels.

The ITC can be applied to the total cost of installing solar panels, including the panels themselves as well as accessories, equipment and labor. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence located in the United States that you own. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum claim amount.

To best understand how the ITC might apply to your situation, get in touch with your local Lopatcong solar panel installer and request more information.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now dubbed the Clean Energy Credit. Now, solar installation projects begun after January 1, 2022 and finished by December 31, 2032 can qualify for a 30% tax credit. This credit amount will then see a slight annual decrease until the end of the current Clean Energy Credit in 2035. Starting in 2023, the program expansion will also make credits for energy storage systems even easier to claim.

More information about the new Inflation Reduction Act can be found here. Your local Lopatcong solar panel installers are the best people to answer your questions about the new Clean Energy Credit and how it applies to you.

State & Local Solar Incentives

Not all solar incentives are federal; rebates, tax credits and more are often offered at the local or state level. These incentives — which may be handled by the state of New Jersey, or by your county or municipality — may be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Lopatcong

There are a number of different solar incentives: those provided by the federal government, those provided by the New Jersey government and those provided by local utility companies, to name a few. Solar energy utilization has grown tremendously in the last 15 years, partially thanks to these incentives. Your local Lopatcong solar panel installation expert can provide you with more details about which incentives you should apply for, and get you on track to switch to renewable energy today.