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

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

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

Solar incentives are intended to encourage people to make the switch to renewable energy by providing financial incentives meant to lower the burden of solar panel installation and use. Solar incentives may include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are handled by the federal government, some by the state of New Jersey and some by your utility company, county or municipality. Some solar incentives you might qualify for are:

• Rebates: Solar rebates might be provided by your local utility company, or by your county or state. These rebates are essentially cash back that is applied after your purchase of solar panels and before tax credits are calculated.
• Tax Credits: Tax credits reduce, dollar-for-dollar, the amount of income tax you owe the government. These differ from tax deductions.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are normally handled by your state government. Once your solar panel system meets a predetermined threshold (usually 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 receive is usually considered part of your taxable income.
• Net Metering: You may be able to sign a net metering agreement with your Ridgefield Park utility company, that may apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then subtract this value from your utility bill each month.
• Tax Exemptions: These may come in the form of property tax exemptions, which can let you exclude the value of your solar system when paying taxes on your house. They may also include exemptions on sales tax at the time of purchase.

Federal Solar Incentives

When you think about solar incentives, you probably think of federal incentives first. An incentive many people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a specific percentage of the cost of your solar system.

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

Talking to your local Ridgefield Park solar panel installer is the best way to learn more about how the ITC may apply to your situation.

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. Under the new program, solar installation projects begun after January 1, 2022 and finished by December 31, 2032 may be eligible for a 30% tax credit. This credit amount will then decrease slightly each year until the current Clean Energy Credit expires in 2035. The expansion to the program also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.

Click here to learn more about the new Inflation Reduction Act. The best way to learn more about how the new Clean Energy Credit applies to you is to get in touch with your local Ridgefield Park solar panel company.

State & Local Solar Incentives

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

Next Steps for Installing Solar in Ridgefield Park

Solar incentives might come from the federal government, the New Jersey government or your local utility company. The variety of solar incentives available has facilitated the nationwide growth of solar energy use in the last 15 years. We recommend talking to your local Ridgefield Park solar installer for more information about these incentives and to be sure that you're getting the largest number possible for your solar system.