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

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

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

Solar incentives help mitigate the cost of installing solar panels on your home. Financial incentives like these are in place to encourage more Americans to convert their home partially or fully to renewable energy. You might qualify for different types of incentives, such as cash back, discounts 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. You might qualify for any of the following types of solar incentives:

• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are normally handled by your state government. Once your solar system meets a predetermined threshold (normally a small amount of energy production), you are eligible to receive SRECs that can be sold to your utility company or other buyers. The money you receive is usually considered part of your taxable income.
• Net Metering: Net metering factors in after your solar system is up and running. If you've signed a net metering agreement with your Teaneck utility company, they will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some locations, this credit is dollar-for-dollar, while in other areas you might receive a refund equivalent to a percentage of the value.
• Rebates: Rebates, or partial refunds after a purchase, are normally given prior to any solar tax credits being calculated. These rebates may be given by your local utility company, by your county or by your state.
• Tax Exemptions: Your solar panels may qualify for exemptions on both sales and property tax. Sales tax exemptions are applied at the time of purchase. Property tax exemptions let you ignore the value that solar panels add when calculating property taxes on your home.
• Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the government.

Federal Solar Incentives

When you hear the term "solar incentives," federal incentives may be the first thing that comes to mind. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit equal to a certain percentage of the money you spend on your solar system.

The ITC can be applied to solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, labor, equipment and accessories. This credit can be claimed on a solar panel system installed on a primary or secondary residence that you own in the United States. The original claim amount was 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum amount you can claim.

Your local Teaneck solar panel installation expert can provide you with more information about the ITC and how it might apply to your situation.

The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). For solar systems installed between January 1, 2022 and December 31, 2032, homeowners may be eligible for a credit equal to 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit ends 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. To fully understand how the new Clean Energy Credit applies to you, speak with your local Teaneck solar installation company.

State & Local Solar Incentives

Rebates, tax credits and more might be provided at multiple levels. On top of federal solar incentives, there are often state and local ones, too. Incentives might be provided by the state of New Jersey, or by your county or municipality. Some incentives are available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in Teaneck

The nationwide use of solar energy has increased enormously in the past 15 years, in part thanks to the increase in availability of solar incentives. You may get these incentives from the New Jersey government, the federal government or your local utility company. We suggest talking to your local Teaneck solar installation company to learn more about these incentives and to be sure that you're getting all of the money you can for your solar panels.