Schenectady, NY

The New York Solar Equipment Tax Credit is a state tax incentive that helps homeowners reduce the cost of going solar. This credit allows you to claim 25% of your qualified solar energy system equipment costs, up to a maximum credit of $5,000. The solar system must be installed at your primary residence in New York State and used for heating, cooling, hot water, or electricity generation.

You can qualify for this credit in three ways: by purchasing solar equipment outright, entering into a lease agreement for solar equipment, or signing a power purchase agreement (PPA) that spans at least 10 years to buy electricity from solar panels you don’t own. While this credit isn’t refundable (meaning you won’t get cash back if the credit exceeds your tax liability), any unused portion can be carried forward for up to five years, giving you flexibility to use the full benefit over time. To claim this credit, you’ll need to file Form IT-255 with your New York State tax return.

New York’s Property Tax Exemption for solar energy systems allows homeowners to avoid paying property taxes on the increased value that solar panels add to their home. When you install a solar system, your home’s assessed value typically increases, but this exemption protects you from paying higher property taxes on that added value for 15 years. The exemption applies to the increase in assessed value only – you’ll still pay property taxes on your home’s original value.

To qualify, your solar system must be constructed between January 1, 1991 and January 1, 2030, with construction considered to begin when you sign a contract or interconnection agreement with your utility company. The exemption is subject to local option, meaning your county, city, town, village, or school district can choose whether to offer it – so availability varies by location. Some local governments may require you to enter into a payment-in-lieu-of-taxes (PILOT) agreement, which could require annual payments up to what you would have paid without the exemption. It’s important to check with your local tax assessor to confirm the exemption is available in your area and understand any local requirements before installing your solar system.

New York’s Sales Tax Exemption for residential solar energy systems helps homeowners save money by eliminating sales tax on solar equipment purchases and installation. This state-level incentive has been available since 2005 and removes the standard 4% New York State sales tax, plus the additional 3/8% tax that applies in the Metropolitan Commuter Transportation District (which includes New York City and surrounding counties).

The financial benefit varies depending on your location within New York. All homeowners automatically save the 4% state sales tax on their solar purchase. However, local sales tax exemptions depend on where you live – some counties and cities provide full exemption from local taxes (bringing your total tax rate to 0%), while others still charge local sales tax ranging from 1.5% to 4.5%. For example, residents in Albany County, Erie County, Nassau County, Suffolk County, and New York City pay no sales tax at all on residential solar systems, while residents in areas like Monroe County or Chautauqua County would still pay 4% local sales tax but save on the state portion.

This exemption applies to residential solar energy systems equipment and installation, with no income requirements or application process needed. The savings are automatically applied at the point of purchase when you buy qualifying solar equipment. There are no expiration dates or deadlines mentioned for this incentive, making it a reliable long-term benefit for New York homeowners considering solar energy systems.

The NY-Sun Program is New York State’s comprehensive solar incentive initiative that provides direct financial rebates to homeowners who install solar panel systems. Administered by NYSERDA (New York State Energy Research and Development Authority), this program offers upfront cash incentives that reduce the total cost of your solar installation, making clean energy more affordable for New York families.

The program operates through a regional block structure across three main areas: Con Edison territory (New York City and Westchester), Long Island, and Upstate New York. Each region has allocated megawatts (MW) of solar capacity eligible for incentives, and incentive amounts decrease as each block fills up. This means earlier participants typically receive higher incentive amounts. The program is designed to gradually phase out incentives as the solar market becomes more self-sustaining, so timing matters for maximizing your savings.

Homeowners should know that incentive levels change in real-time based on demand and are available on a first-come, first-served basis until each regional block is fully subscribed. You’ll need to work with a NY-Sun participating contractor to access these incentives, and the specific dollar amount you’ll receive depends on your location, system size, and current block availability. The program covers residential, commercial, and community solar projects, ensuring options for various property types and energy needs.

Net metering in New York allows homeowners with solar panels to receive credit for excess electricity they generate and send back to the power grid. When your solar system produces more energy than your home uses, that extra power flows to the grid and you receive credits on your electric bill. These credits offset the electricity you use from the grid when your solar panels aren’t producing enough power, like at night or during cloudy days.

New York uses a 1:1 net metering system, meaning you receive full retail rate credit for every kilowatt-hour (kWh) of solar energy you export to the grid. Your utility company nets your monthly solar production against your total electricity consumption, and any excess credits roll over month to month and year to year for up to 20 years. However, you won’t receive cash payments for surplus credits – they simply expire after the 20-year period.

All major New York utilities participate in this program, though each charges a monthly Contribution Benefits Charge (CBC) that ranges from $0.85 to $1.45 per kW of your solar system’s capacity. For example, if you have a 10 kW solar system with National Grid, you’d pay an additional $14.50 monthly fee. The specific rate depends on your utility company, with PSEG Long Island having the lowest fee and National Grid having the highest.