Solar Energy Sales Tax Exemption
Administered by New Jersey Division of Taxation
New Jersey fully exempts solar energy equipment from state sales tax, so you don't pay sales tax on eligible solar electric, water heating, space heating, pool heating, and passive solar systems. To claim it, give the seller a completed Form ST-4 (Exempt Use Certificate) instead of paying the tax. Devices you would need regardless of the energy source are not covered.
Your customers can buy eligible solar equipment without sales tax, which lowers upfront project costs for residential, commercial, and industrial buyers. The purchaser must give you a completed Form ST-4 (Exempt Use Certificate) in place of tax payment, so collect it for your records. Eligible items are devices or systems approved by the Board of Public Utilities, Division of Energy, that convert solar energy to usable heating, cooling, electrical or mechanical power, including storage devices, but not equipment required regardless of energy source.
This is a full state sales tax exemption for solar energy equipment, administered by the New Jersey Division of Taxation under Publication S&U-6, with equipment approval tied to the Board of Public Utilities, Division of Energy. It is open to all taxpayers across residential, commercial, and industrial sectors and covers solar PV, solar water, space and pool heating, thermal electric, process heat, and passive solar design. It operates through forgone tax revenue rather than a funded budget, and purchasers claim it by submitting Form ST-4 to the seller.
Program details
- Program ID
- 219
- Last updated
- 1/6/2025
Eligibility
- Sectors
- commercial industrial residential
- Technologies
- solar - passive solar water heat solar space heat solar thermal electric solar thermal process heat solar photovoltaics solar pool heating
Program summary
New Jersey offers a full exemption from the state's sales tax for all solar energy equipment. This exemption is available to all taxpayers. All major types solar energy equipment, including equipment for passive solar design, are considered eligible for the exemption as described by the New Jersey Division of Taxation Publication S&U-6 (Sales Tax Exemption Administration). According to S&U-6, the exemption includes all solar energy "devices or systems specifically approved by the Board of Public Utilities, Division of Energy and designed to provide heating or cooling or electrical or mechanical power by converting solar energy to some other usable energy source, including devices for storing solar-generated energy." The exemption does not apply to devices that would be required regardless of the energy source being utilized. In order to claim the exemption, the purchaser must fill out and submit Form ST-4 (Exempt Use Certificate) to the seller instead of paying sales tax.
Contact & resources
- Contact email
- cameron.johnson@bpu.state.nj.us
Please verify current program details with the administering agency before making any financial decisions.
