Energy Tax Credits
here and if you've been thinking about "going green" and
making your home more energy efficient, then there's no time
like the present, especially if you take advantage of
residential energy tax credits still available to
The Residential Energy Efficient Property Credit is
available to individual taxpayers to help pay for qualified
residential alternative energy equipment, such as solar hot
water heaters, solar electricity equipment and residential
wind turbines. Qualifying equipment must have been installed
on or in connection with your home located in the United
Geothermal pumps, solar energy systems, and residential wind
turbines can be installed in both principal residences and
second homes (existing homes and new construction), but not
rentals. Fuel cell property qualifies only when it is
installed in your principal residence (new construction or
existing home). Rentals and second homes do not qualify.
credit is 30% of the cost of the qualified property,
with no cap on the amount of credit available, except
for fuel cell property.
Generally, labor costs can be
included when figuring the credit. Any unused portions of this
credit can be carried forward. Not all energy-efficient
improvements qualify so be sure you have the manufacturer's
tax credit certification statement, which can usually be found
on the manufacturer's website or with the product packaging.
What's Included in the Tax Credit?
Geothermal Heat Pumps. Must meet the requirements of
the ENERGY STAR program that are in effect at the time of the
Small Residential Wind Turbines. Must have a nameplate
capacity of no more than 100 kilowatts (kW).
Solar Water Heaters. At least half of the energy
generated by the "qualifying property" must come from the sun.
The system must be certified by the Solar Rating and
Certification Corporation (SRCC) or a comparable entity
endorsed by the government of the state in which the property
is installed. The credit is not available for expenses for
swimming pools or hot tubs. The water must be used in the
dwelling. Photovoltaic systems must provide electricity for
the residence, and must meet applicable fire and electrical
Solar Panels (Photovoltaic Systems). Photovoltaic
systems must provide electricity for the residence, and must
meet applicable fire and electrical code requirement.
Fuel Cell (Residential Fuel Cell and Microturbine System.)
Efficiency of at least 30% and must have a capacity of at
least 0.5 kW.
We're happy to help you sort out the tax credits available for
your "green" home improvements this summer.
If you have any questions about how to set up
residential energy tax credits, please give me a call at 301-657-8080. We
can help guide you in the right direction.
this article online,
click here or go to
www.eSullivan.net and click on the Newsletter section.
As always you can call our offices if you have any
questions about these or any other accounting, tax,
financial planning or insurance related issues, at 301-657-8080.
Regards, Paul Sullivan, CPA
President, Sullivan & Company