Home Energy Credits Enhanced

As part of the recently enacted Economic Stabilization legislation, homeowners can continue to benefit from a tax credit for installing energy-generating systems into their homes.  The new law removed limitations and added wind and geothermal generating systems.  If you are thinking of going green, here is an overview of these credits.

• Residential solar equipment - For property placed in service before the end of 2016, a credit is allowed for 30% of the cost of qualifying solar water heaters, up to $2,000 per year, and a credit subject to the same limits also applies for photovoltaic (electricity-generating) solar panels but the $2,000 per year limit no longer applies after 2008.  The foregoing applies to the taxpayer’s first or second homes.

• Fuel cell equipment - In addition, a 30% credit is allowed for fuel cell property, up to $500 for each half-kilowatt of capacity installed per year on the taxpayer’s principal residence.

• Wind & Geothermal energy equipment - A 30% credit is allowed for qualified systems placed into service before 2016. The credit is limited to $500 for each half-kilowatt of capacity (maximum $4,000 for wind turbines and $2,000 for geothermal heat pumps).

Labor costs for onsite installation and for piping and wiring connections are qualifying costs for these credits.  However, the credits do not apply to equipment used to heat swimming pools or hot tubs.

Call this office first to verify the tax benefits before signing on with a contractor or salesperson. 

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