Federal Solar Investment Tax Credit (30%) Buy a new home solar system, and you will be eligible for the 30% federal tax credit. A tax credit is a dollar-for-dollar reduction in the amount of income tax you would otherwise owe. This credit also applies to energy storage systems that are charged by your solar system.

Massachusetts State Tax Credit (15%) A 15% state solar tax credit – up to $1,000 per system – is available to anyone who purchases a solar energy system for their primary residence.   If the credit exceeds the homeowner’s tax liability, the excess credit amount can be carried forward to the next succeeding year for up to three years.

Solar Massachusetts Renewable Target (SMART) program In 2018, Massachusetts replaced the state’s solar renewable energy credit (REC) program with the SMART program. Through the program, your utility pays you a flat base rate for each kilowatt-hour your system produces for ten years. Your base rate depends on your utility and when you apply to the program.

SMART Battery Adder & ConnectedSolutions Program Under the SMART program, if you pair your solar system with an energy storage system, you are eligible for an extra “adder” to your incentive rate. The value of your adder depends on the type of battery you install and the size of your solar panel system. Under the ConnectedSolutions program, if you are an Eversource customer, you can receive an annual incentive for allowing your utility company to use your battery during peak energy demand.

Net Metering Net metering is a program that requires your electric company to purchase excess electricity your solar panels produce. For example, your system may produce more electricity on a typical sunny day than your home consumes. When solar production exceeds usage, the utility meter will “spin” backward and provide you with credits. These credits can then be used when the solar system is not producing electricity, such as at night. In Massachusetts, when your solar system produces more electricity than you use during a billing period, investor-owned utilities credit an amount close to retail prices where you live. These credits appear as a dollar amount (not as kilowatt hours) on your bill and will roll over to the next billing period indefinitely.

Maryland Property Tax Exclusion Adding a solar energy system to your home will not increase your property taxes.

Massachusetts Sales Tax Exemption Adding a solar energy system to your home will not increase your property taxes.

This guide provides an overview of the different federal, state, and local incentives available to those interested in residential solar. It does not constitute professional tax advice or other professional financial guidance. This overview should not be used as your only source of information. Other sources should be consulted when making purchasing, investment, and tax decisions; or while executing other binding agreements.