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

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

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

The term "solar incentives" covers a range of financial incentives implemented to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. The incentives could include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are offered by the federal government, some by the New Jersey government and some by your utility company, county or municipality. Categories of solar incentives include:

• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are usually 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 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.
• Tax Credits: Tax credits lower, dollar-for-dollar, the total amount of tax you owe the government. These are different from tax deductions.
• Tax Exemptions: Sales tax exemptions go into effect at the point of sale for your solar panels. Property tax exemptions let you ignore the value added by your solar system when calculating the amount of property tax you need to pay on your house.
• Net Metering: Don't forget to speak with your North Arlington 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 generated by your solar panels. You might receive either a dollar-for-dollar credit or a percentage of the value.
• Rebates: Rebates, or partial refunds after a purchase, are typically applied prior to any solar tax credits being calculated. These rebates may be offered by your local utility company, by your county or by your state.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some knowledge of. One of the incentives that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a specific percentage of your solar system's cost.

The ITC applies to solar systems installed after January 1, 2006 on a primary or secondary residence that you own in the United States. Originally, the tax credit was for 30% of the total cost — for panels, labor, equipment and accessories — although that amount may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the claim amount.

To best understand how the ITC may apply to your situation, speak to your local North Arlington solar panel installer and ask for more information.

In August 2022, the ITC (now referred to as the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners can receive a credit equal to 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit expires in 2035. Starting in 2023, the expansion will also make claiming credit for energy storage systems easier than ever before.

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

State & Local Solar Incentives

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

Next Steps for Installing Solar in North Arlington

The nationwide use of solar energy has significantly increased in the past 15 years, in part due to the increase in availability of solar incentives. You might receive these incentives from your local utility company, the federal government or the New Jersey government. Speak with your local solar panel installation company today to find out more information and to save as much money as possible on a solar system for your North Arlington home.