Next.js has built-in Babel presets and it's easy to add custom presets and plugins if needed. To customize Babel configuration, create a `.babelrc` file at the project root and include the `next/babel` preset. Additional presets can be added by specifying them in an object within the `presets` array. Plugins can also be added to the `plugins` array. Custom configurations can be used if needed, or plugins can be simply named in the file for easy usage.