Federal tax credits to consumers can pay for 30% of cost of energy efficiency measures.
Consumers who want to save energy by adding insulation, reflective roofing or installing more energy-efficient windows, doors or heating systems, can get the federal government to pay for 30% of these home improvements via a federal tax credit authorized by the stimulus bill passed by Congress earlier this year.
Consumers can receive a tax credit of up to $1,500 for efficiency improvements made this year and next year. That means a household that makes $5,000 worth of energy efficiency improvements by the end of 2010 can get the maximum tax credit of $1,500, or 30% of the cost.
Some equipment, notably solar panels and other home energy systems that use renewable energy, qualifies for the same tax credit, but with no upper limit. People who install solar water heaters, solar panels, geothermal heat pumps, small wind systems or fuel cells are eligible for a federal tax credit that will cover 30% of the cost of these systems. The systems must be in place by 2016.
For the following types of projects, the installation costs, as well as the cost of the equipment, are covered by the tax credit:
• HVAC systems,
• biomass stoves,
• water heaters,
• solar panels,
• heat pumps,
• wind energy systems,
• and fuel cells.
Tax credits of between $2,500 and $7,500 are available for plug-in hybrid electric vehicles. Tax credits also are available for hybrid vehicles, for both personal use and for business use.
Home builders are eligible for a $2,000 tax credit for a new energy-efficient home. A tax deduction of up to $1.80 per square foot is available to owners or designers of new or existing commercial buildings that save at least 50% of the heating and cooling energy of a building that meets ASHRAE Standard 90.1-2001.
More information about the tax credits is available from the Environmental Protection Agencys Energy Star program, http://www.energystar.gov/index.cfm?c=products.pr_tax_credits.
