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

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

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

Solar incentives are designed to encourage people to make the switch to renewable energy by offering financial incentives that lower the burden of solar panel installation and use. Various kinds of incentives, including discounts, cash back or monthly utility bill credits, may be available to you. Some incentives may be handled by the New Jersey government, by your utility company or by county or municipality, while others are federal. Categories of solar incentives include:

• 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.
• Net Metering: Net metering becomes relevant once your solar system is up and running. If you have in place a net metering agreement with your South Brunswick utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in other places you might receive a refund equivalent to a percentage of the value.
• Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar system. Property tax exemptions allow you to ignore the added value of your solar system when you're calculating the amount of property tax you need to pay.
• Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that is generally considered part of your taxable income. In most cases, there is a small threshold of energy production to meet before your solar system qualifies for SRECs or similar performance-based incentives. These kinds of incentives are normally handled by your state government.
• Rebates: A rebate is a partial refund after the purchase of your solar system. Rebates may be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.

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Federal Solar Incentives

When someone says "solar incentives," you probably think of federal incentives first. You might have heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit equal to a specified percentage of the money you spend installing solar panels.

The ITC can be credited towards the value of solar panels installed on your primary or secondary residence in the United States. The solar system has to have been installed on a property you own after January 1, 2006, for you to be eligible for the credit. Initially, the ITC applied to 30% of all system installation costs (panels, accessories, labor and equipment), although the amount has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the amount you can claim.

To best understand how the ITC will apply to you, get in touch with your local South Brunswick solar panel installation expert and request 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 Clean Energy Credit re-raises the credit up to 30% for solar installations undertaken between January 1, 2022, and December 31, 2032. After 2032, the credit percentage will decrease slightly each year until the end of the program in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit will apply to you, speak with your local South Brunswick solar installation company.

State & Local Solar Incentives

Tax credits, rebates and more can be provided at multiple levels. In addition to federal solar incentives, there are often state and local ones as well. These solar incentives — which might be provided by the state of New Jersey, or by your county or municipality — could be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in South Brunswick

You can qualify for solar incentives from the federal government and the New Jersey government, as well as from your local utility company. This increase in availability of solar initiatives in the past 15 years has helped increase nationwide solar energy use enormously. It is a good idea to talk to your local South Brunswick solar installation expert for more information about these incentives and to be sure that you're getting the largest number possible for your solar panels.