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

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

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

Solar incentives are designed to encourage homeowners to make the switch to renewable energy by providing incentives meant to lower the financial burden of solar panel installation and use. Different types of incentives, including cash back, discounts or credit towards your monthly utility bill, might be available to you. Some incentives may be provided via the state of New Jersey, by your utility company or by county or municipality, while others are federal. You might qualify for any of the following types of solar incentives:

• Net Metering: Net metering becomes relevant after your solar system is up and running. If you have in place a net metering agreement with your Wall utility company, the company will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some areas, this is a dollar-for-dollar credit, while in other areas you may receive a refund equivalent to a percentage of the value.
• Tax Exemptions: Tax exemptions can come in one of two forms. The first is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption, which allows you to ignore the added value of your solar system when calculating property tax for your house.
• Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the federal government. (This is different from a tax deduction.)
• Rebates: Rebates, or partial refunds after a purchase, are typically given before any solar tax credits are calculated. Rebates can be offered by your local utility company, by your state or by your county.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives may be available to you if you have a solar system that produces over a specified (generally small) amount of electricity. This category of incentives is generally handled by the state government. You can sell any SRECs you have to your utility company or other buyers, and the money you make is generally considered part of your taxable income.

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Federal Solar Incentives

When thinking about solar incentives, you likely think of federal incentives first. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a percentage of your solar system's cost.

The ITC can be applied 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, labor, accessories and equipment – although the percentage may range from 26-30%, depending on the installation date of your solar system. There is no cap on the amount you can claim.

Your local Wall solar panel installer can provide more information about the ITC and how it might apply to your situation.

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. For solar system installations that begin after January 1, 2022, and are completed by the end of 2032, homeowners can receive a credit for 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit ends in 2035. Starting in 2023, the program expansion will also make claiming credit for energy storage systems easier than ever before.

More information about the new Inflation Reduction Act can be found here. The best way to fully understand how the new Clean Energy Credit might apply to you is to reach out to your local Wall solar panel installers with your questions.

State & Local Solar Incentives

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

Next Steps for Installing Solar in Wall

You can apply for and receive solar incentives from the federal government and the New Jersey government, as well as from your local utility company. The growing availability of solar initiatives in the past 15 years has helped increase nationwide solar energy use enormously. Getting in touch with your local Wall solar panel installer is an excellent first step towards getting all the incentives you qualify for when you switch to solar energy.