2025 Solar Incentives Guide for Metuchen, NJ - Tax Credits & Rebates

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

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

Solar incentives are designed to encourage people to switch their home over to renewable energy by providing incentives that lower the financial burden of solar panel installation and use. You may qualify for various kinds of incentives, including discounts, cash back or monthly utility bill credits, 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 broad categories of solar incentives include:

• Tax Exemptions: These could come in the form of property tax exemptions, which allow you to exclude the value of your solar system when calculating the taxes you pay on your home. They may also include exemptions on sales tax at the time of purchase.
• Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the government.
• Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar system. These could be offered by your local utility company, your state or your county. The rebates are usually applied before calculating tax credits.
• Net Metering: Make sure you talk to your Metuchen utility company about signing a net metering contract. This will allow you to receive credit towards your monthly utility bill for the value of excess energy your solar panels generate. You could receive either a dollar-for-dollar credit or a percentage of the value.
• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are usually handled by your state government. Once your solar system meets the threshold (generally a small amount of energy production), you are eligible to receive SRECs that you can then sell to your utility company or other buyers. The money you make from the sale is generally considered part of your taxable income.

Federal Solar Incentives

When you think about solar incentives, you likely think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is the most commonly known federal solar incentive. The ITC provides you with a tax credit for a specific percentage of your solar system's cost.

The ITC applies towards solar systems installed after January 1, 2006, and under this program you can deduct from your taxes a percentage of the total cost of solar panels, equipment, accessories and labor. This credit can apply towards solar panels installed on a primary or secondary residence in the United States that you own. The original claim amount was 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum claim amount.

Have questions about how the ITC applies to your specific situation? Get in touch with your local Metuchen solar panel installer 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. The new Clean Energy Credit is valid until 2035. American homeowners can now receive a 30% credit for solar systems installed between January 1, 2022, and December 31, 2032. This credit will then see a slight annual decrease until it expires. The expansion also makes credits for energy storage systems even easier to claim, beginning in 2023.

More information about the new Inflation Reduction Act can be found here. Your local Metuchen solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it applies to you.

State & Local Solar Incentives

In addition to federal solar incentives, there are often also state ones. Rebates, tax credits and more can be offered at a more local level. Certain incentives are offered for only a limited time, while others are ongoing. These local incentives may come from your county or municipality, or from the New Jersey government.

Next Steps for Installing Solar in Metuchen

There are a number of different solar incentives: those provided by the federal government, those offered by the New Jersey government and those offered by local utility companies, to name a few. Solar energy use has increased tremendously in the last 15 years, partially due to these incentives. Your local Metuchen solar panel installation company can help you learn more about which incentives you should apply for, and get you feeling good about making the change to renewable energy today.