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

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

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 homeowners to switch their home over to renewable energy. Different kinds of incentives, including discounts, cash back or monthly utility bill credits, may 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:

• Rebates: A rebate is a partial refund after the purchase of your solar panels. Rebates could be offered by your local utility company, your county or your state. The rebates are usually applied before tax credits are calculated.
• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the government.
• Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are typically handled by your state government. Once your solar panel system meets the threshold (usually a small amount of energy production), you can receive SRECs that can then be sold to your utility company or other buyers. The money you receive from the sale is generally considered part of your taxable income.
• Net Metering: Net metering is an incentive you can get once your solar panels are up and running. If you have a net metering agreement in place with your Wallington 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 places, this is a dollar-for-dollar credit, while in others you may make back a percentage of the value.
• Tax Exemptions: Your solar panels might qualify for both sales tax and property tax exemptions. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to exclude the added value of the solar panels when calculating property taxes on your home.

Federal Solar Incentives

When you think about solar incentives, you likely think of federal incentives first. A federal incentive many people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a given percentage of your solar system's cost.

The ITC can be applied to the total cost of solar system installation, including the panels themselves as well as equipment, labor and accessories. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence located in the United States that you own. The tax credit ranges from 26-30% of total costs depending on when your project was completed. There is no maximum amount you can claim.

To best understand how the ITC will apply to your situation, call your local Wallington solar panel installer and ask for more information.

In August 2022, the ITC (now referred to as the Clean Energy Credit) was expanded and extended by the passage of the Inflation Reduction Act. For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners may be eligible for a credit for 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit ends in 2035. The expansion 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. Your local Wallington solar panel installers are the best people to answer your questions about the new Clean Energy Credit and how it applies to you.

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, too. Incentives might be offered by your county or municipality, or by the state of New Jersey. Certain incentives might only be available for a limited time, while others are ongoing.

Next Steps for Installing Solar in Wallington

Nationwide solar energy use has increased enormously in the last 15 years, in part due to the growth in the number of solar incentives. You can obtain these incentives from the New Jersey government, the federal government or your local utility company. Reach out to your local solar panel installer today to discover more about the various programs and to save as much money as possible on a solar system for your Wallington home.