2024 Solar Incentives Guide for Martinsville, NJ - Tax Credits & Rebates

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

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

Solar incentives encourage homeowners to make the switch to renewable energy by offering financial incentives that lower the burden of solar panel installation and use. Different kinds of incentives, including cash back, discounts or credit towards your monthly utility bill, may be available to you. Certain incentives may be handled by the state of New Jersey, by your utility company or by county or municipality, while other incentives are federal. You might qualify for any of the following types of solar incentives:

• Net Metering: Net metering becomes relevant once your solar panels are up and running. If you've signed a net metering agreement with your Martinsville utility company, it will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in other places you might make back a percentage of the value.
• Rebates: A solar rebate is a partial refund given after you've purchased your solar system. Rebates might 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.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are normally handled at the state level. Once your solar system meets the qualification threshold (generally 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 receive from the sale is generally considered part of your taxable income.
• Tax Exemptions: Sales tax exemptions are applied at the point of sale for your solar system. Property tax exemptions allow you to ignore the value added by your solar system when calculating how much property tax you need to pay on your house.
• Tax Credits: Tax credits lower, dollar-for-dollar, the amount of income tax you owe the federal government. Tax credits are different from tax deductions.

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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're most likely to have heard of 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 originally covered 30% of the total cost of solar system installation, although that number has fluctuated slightly over the years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total cost of installation includes the panels themselves as well as the cost of equipment, accessories and labor. There is no maximum amount you can claim. The ITC can be applied to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be in the United States and owned by you.

Curious how the ITC might apply to your specific situation? Contact your local Martinsville solar panel installation expert to get more information.

The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. For solar system installations that begin after January 1, 2022, and are completed by the end of 2032, homeowners may be eligible for a credit equal to 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit ends in 2035. Starting in 2023, the program expansion will also make claiming credit for energy storage systems easier than ever before.

More information about the new Inflation Reduction Act can be found here. To better understand how the new Clean Energy Credit applies to you, speak with your local Martinsville solar installers.

State & Local Solar Incentives

Tax credits, rebates and more might be provided at multiple levels. Along with federal solar incentives, there are often state and local ones, too. The incentives — which may be given by the state of New Jersey, or by your county or municipality — may be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Martinsville

There are a number of different solar incentives: those offered by local utility companies, those given by the federal government and those provided by the New Jersey government, to name a few. The use of solar energy has grown tremendously in the last 15 years, partially thanks to these incentives. If you're ready to make the change to solar energy, calling your local Martinsville solar panel installation expert is an excellent place to start.