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

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

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

Solar incentives are designed to encourage homeowners to make the switch to renewable energy by offering financial incentives meant to lower the burden of solar panel installation and use. Various kinds of incentives, like cash back, discounts or monthly utility bill credits, might be available to you. Certain incentives may be provided via the New Jersey government, by your utility company or by county or municipality, while other incentives are federal. Categories of solar incentives include:

• Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
• Net Metering: Net metering becomes relevant after your solar system is up and running. If you have a net metering agreement in place with your West Deptford utility company, they 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 other places you might be refunded a percentage of the value.
• Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar panels. Rebates may be offered by your local utility company, your county or your state. The cash back that you get from the rebates is normally applied before calculating tax credits.
• Tax Exemptions: Your solar panel system may qualify for exemptions on both sales and property tax. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions let you ignore the added value of the solar panels when you are calculating property taxes on your home.
• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives might be available to you if you have a solar system that produces more than a specified (typically small) amount of electricity. This category of incentives is usually 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 normally considered part of your taxable income.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some knowledge of. You might have heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit equal to a predetermined percentage of the money you spend on solar panels for your home.

The ITC can be applied to solar systems installed after January 1, 2006 on a primary or secondary residence that you own in the United States. Originally, the tax credit was for 30% of the total cost — for panels, equipment, labor and accessories — although it may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the claim amount.

Contacting your local West Deptford solar panel installation expert is the best way to learn more about how the ITC could apply to you.

In August 2022, the Inflation Reduction Act expanded and extended the ITC, now called the Clean Energy Credit. The Clean Energy Credit has increased the current credit up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. After 2032, the credit percentage will decrease slightly each year until the end of the program in 2035. The expansion to the program also makes credits for energy storage systems even easier to claim, starting in 2023.

More information about the new Inflation Reduction Act can be found here. The easiest way to fully understand how the new Clean Energy Credit applies to you is to reach out to your local West Deptford solar panel company with your questions.

State & Local Solar Incentives

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

Next Steps for Installing Solar in West Deptford

Solar incentives may be provided by the federal government, the New Jersey government or your local utility company. The growing number of available solar incentives has helped nationwide use of solar energy increase greatly in the last 15 years. Your local West Deptford solar panel installer can provide you with more details about which incentives you should apply for, and get you on track to switch to renewable energy today.