Incentives and Financing

Smart Solar Financing

If you have a credit score of over 640*, and qualify for a tax credit, (most of us do), no money down financing is what you want. When you purchase a PV solar system, you are entitled to Federal and State tax credits.   In most cases, the tax credits pay more than 1/2 of the cost.  The SMART SOLAR PROGRAM is NO OUT OF POCKET, using an unsecured, hybrid loan.  The portion of money that will be reimbursed by incentives is financed in a one year, no interest loan.  This one year loan will give you time to get your tax credits without paying interest.  When you receive your tax refund, pay the loan and close it out.  The remainder, your actual net investment, is financed in an unsecured, fixed rate loan for 12 – 15 years.  The interest rate on the loan is low and fixed.  There are no prepayment penalties.

Solar Incentives and Financing

Net Metering

Net metering is available on a first-come, first-served basis to customers of the state’s major investor-owned utilities, subject to technology, system size and aggregate capacity limitations. Publicly-owned utilities are not obligated to offer net metering; however, PSEG Long Island offers net metering on terms similar to those in the state law. Below is listing of the system size limitations, organized by technology and eligible sector.

  • Solar: 25 kW for residential, 100 kW for farms, 2 MW for non-residential

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Sales Tax Exemption

New York enacted legislation in July 2005 exempting the sale and installation of residential solar-energy systems from the state’s sales and compensating use taxes. The exemption was extended to non-residential solar systems in August 2012 (S.B. 3203), effective beginning January 1, 2013. In 2015 the exemption was extended to solar systems that are owned by third party owners, who provide solar electricity to residential and commercial users.

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Federal Tax Credit

A taxpayer may claim a credit of 30% of qualified expenditures for a system that serves a dwelling unit located in the United States that is owned and used as a residence by the taxpayer. Expenditures with respect to the equipment are treated as made when the installation is completed. If the installation is at a new home, the “placed in service” date is the date of occupancy by the homeowner. Expenditures include labor costs for on-site preparation, assembly or original system installation, and for piping or wiring to interconnect a system to the home. If the federal tax credit exceeds tax liability, the excess amount may be carried forward to the succeeding taxable year. The maximum allowable credit, equipment requirements and other details vary by technology, as outlined below.

Solar-electric property

  • 30% for systems placed in service by 12/31/2019
  • 26% for systems placed in service after 12/31/2019 and before 01/01/2021
  • 22% for systems placed in service after 12/31/2020 and before 01/01/2022
  • There is no maximum credit for systems placed in service after 2008.
  • Systems must be placed in service on or after January 1, 2006, and on or before December 31, 2021.
  • The home served by the system does not have to be the taxpayer’s principal residence.

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NY StateTax Credit

Enacted in August 1997, this personal income tax credit originally applied to expenditures on solar-electric (PV) equipment used on residential property. The credit, equal to 25% percent of the cost of equipment and installation, was expanded in August 2005 to include solar-thermal equipment. The solar-thermal provisions apply to taxable years beginning on and after January 1, 2006. The credit is capped at $3,750 for solar-energy systems placed in service before September 1, 2006, and capped at $5,000 for solar-energy systems placed in service on or after September 1, 2006.

Solar Incentives and Financing