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

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

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

Solar incentives mitigate the cost of installing a solar panel system on your home. These financial incentives are intended to encourage more Americans to switch to renewable energy. These incentives might include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are offered by the federal government, some by the state of New Jersey and some by your utility company, county or municipality. Some broad categories of solar incentives include:

• Net Metering: Make sure you talk with your Upper utility company about signing a net metering agreement. This allows you to get a credit towards your utility bill every month 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.
• Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
• Rebates: Some solar companies will help you claim a rebate, or partial refund of your purchase, for your solar system. Counties or states will also sometimes offer limited-time rebates. If you receive a rebate, that amount will usually come off the total price before any tax credits are calculated.
• Tax Exemptions: Your solar panel system may qualify for both sales tax and property tax exemptions. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions let you exclude the value that solar panels add when you are calculating property taxes on your home.
• Solar Renewable Energy Certificate (SREC): In general, solar systems that produce more than a specified (usually small) amount of electricity qualify for SRECs or similar performance-based incentives. SRECs and performance-based incentives in general are typically offered at the state level. When you receive an SREC, you can sell it to your utility company or another buyer, and this is usually considered part of your taxable income.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some familiarity with. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a certain percentage of the cost of your solar system.

The ITC originally covered 30% of the cost of installing a solar system, although that number has fluctuated slightly over the years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total cost of installation includes the panels themselves as well as the cost of equipment, labor and accessories. There is no maximum amount you can claim. The ITC applies to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be in the United States and owned by you.

To find out exactly how much money the ITC could save you, talk to your local Upper solar panel installation expert.

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. The new Clean Energy Credit extends until 2035. You can now apply for a 30% credit for solar systems installed between January 1, 2022, and December 31, 2032. This new credit will then see a slight annual decrease until the date of expiration. Beginning in 2023, it will also be easier to get credits for energy storage systems with the new act.

Click here to learn more about the new Inflation Reduction Act. Your local Upper solar panel company can answer any questions you have and explain how the new Clean Energy Credit applies to you.

State & Local Solar Incentives

Federal solar incentives are not your only option; rebates, tax credits and more are often offered at the local or state level. Incentives may be provided by your county or municipality, or by the state of New Jersey. Some incentives are available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in Upper

Solar energy use nationwide has gone up tremendously in the past 15 years, in part thanks to the growth in the number of solar incentives. You can obtain these incentives from the federal government, the New Jersey government or your local utility company. We recommend talking to your local Upper solar installer for more information about these incentives and to be sure that you're getting the largest number possible for your solar panels.