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

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

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

The term "solar incentives" includes 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. These incentives can include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are offered by the federal government, some by the state of New Jersey and some by your utility company, county or municipality. You might qualify for any of the following types of solar incentives:

• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
• Net Metering: Make sure you speak with your Maplewood utility company about signing a net metering agreement. This will allow you to get a credit towards your utility bill every month 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.
• Solar Renewable Energy Certificate (SREC): SRECs and other similar performance-based incentives are generally handled at the state level. Once your solar system meets a predetermined threshold (usually a small amount of energy production), you can receive SRECs that can then be sold to your utility company or other buyers. The money you make from the sale is generally considered part of your taxable income.
• Tax Exemptions: Sales tax exemptions go into effect at the point of sale for your solar system. Property tax exemptions let you exclude the value that your solar panels add when you're calculating how much property tax you need to pay on your house.
• Rebates: A rebate is a partial refund credited to your account after you've paid for your solar panels. These may be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some knowledge of. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a predetermined percentage of your solar system's cost.

The ITC was originally for 30% of the cost of installing solar panels, although it has fluctuated slightly over the last few years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The cost of installation includes the panels themselves as well as the cost of accessories, equipment and labor. There is no maximum claim amount. The ITC can be applied to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be owned by you and in the United States.

Contacting your local Maplewood 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. Homeowners can now qualify for a credit of 30% of the total costs of solar system installation for projects that began after January 1, 2022 and will be finished by the end of 2032. This percentage will then begin to decrease yearly until the Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to get credits for energy storage systems under this new program.

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

State & Local Solar Incentives

Some solar incentives may be provided at the state and local level. Similar to federal incentives, these could include rebates, tax credits and more. Certain incentives are ongoing, while others are only available for a limited time. They might be given by the New Jersey government, or by your county or municipality.

Next Steps for Installing Solar in Maplewood

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 due to these incentives. Your local Maplewood solar panel installation company can give you more information about which incentives you might qualify for, and get you feeling good about making the change to renewable energy today.