Ready, Set, GO GREEN
On February 17, 2009 President Obama signed into law the American Recovery and Reinvestment Act of 2009 (also known as the "Stimulus Bill") which among other changes extended Federal tax credits for energy efficient home improvements to 2010.
Tax Credits for Consumers:
Home Improvements
Home improvement tax credits are now available for upgrades placed in service from January 1, 2009 through December 31, 2010. Any qualified home improvements made in 2008 are not eligible for the tax credit. The improvements must be to an existing home which qualifies as your principal residence. New construction and rentals do not qualify.
Home improvement tax credits are available for insulation, replacement windows and doors, roofs, water heaters (includes installation costs), certain high efficiency heating and cooling equipment (includes installation costs), and biomass stoves (includes installation costs). 30% of the cost up to $1,500 is the maximum total amount that can be claimed for all products placed in service in 2009 and 2010 for most home improvements, EXCEPT for geothermal heat pumps, solar water heaters, solar panels, fuel cells, and small wind energy systems which are not subject to this cap, and are in effect through 2016.
If you are building a new home, you can qualify for the tax credit for geothermal heat pumps, solar water heaters, small wind energy systems and fuel cells, but not the tax credits for windows, doors, insulation, roofs, HVAC, or non-solar water heaters.
Efficient Automobiles
For electric vehicles and plug-in hybrids purchased in or after 2010, buyers may be eligible for a federal income tax credit of up to $7,500. The credit amount will vary based on the capacity of the battery used to fuel the vehicle.
For qualifying alternative fuel vehicles purchased or placed into service between January 1, 2005 and December 31, 2010, buyers may be eligible for a federal income tax credit of up to $4,000.
For hybrid and diesel vehicles purchased or placed into service after December 31, 2005, buyers may be eligible for a federal income tax credit of up to $3,400. The credit will be phased out over 15 months starting after that manufacturer has sold 60,000 eligible vehicles. For vehicles made by manufacturers that have not reached the end of the phase-out, the credits will end for vehicles placed in service after December 31, 2010.
Geothermal Heat Pumps
Tax credits are available to homeowners who install geothermal heat pumps. The tax credit is equal to 30% of the cost of the system, including installation costs. The tax credit applies to existing homes and new construction. Both principal residences and second homes can qualify. Rentals do not quality. The credits are available for systems placed in service before December 31, 2016.
Solar Energy Systems
The tax credits are available for qualified solar water heating and photovoltaic systems. At least half of the energy generated by the "qualifying property" is required to come from the sun. The credit is not available for expenses for swimming pools or hot tubs. The water must be used in the residence. The tax credit is equal to 30% of the cost of the system, including installation costs. The tax credit applies to existing homes and new construction. Both principal residences and second homes can qualify. Rentals do not qualify. The credits are available for systems placed in service before December 31, 2016.
Small Wind Turbines
The tax credits of up to 30% of cost are available to homeowners who install residential small wind turbine systems. The systems are required to have a nameplate capacity of no more than 100 kilowatts. The tax credit applies to existing homes and new construction. Both principal residences and second homes can qualify. Rentals do not qualify. The credit is available for systems placed in service before December 31, 2016.
Fuel Cells
There is a consumer tax credit of up to 30% of the cost (up to $500 per 0.5 kW of power capacity) for installing a "qualified” residential fuel cell and microturbine system. The tax credit applies to existing homes and new construction, which qualify as your principal residence. Rentals and second homes do not qualify. The credit is available for systems placed in service before December 31, 2016.
Tax Deductions for Commercial Buildings:
A tax deduction of up to $1.80 per square foot is available to owners/tenants of commercial buildings that save at least 50% of the heating and cooling energy of a building that meets ASHRAE Standard 90.1-2001. Partial deductions of up to $.60 per square foot can be taken for measures affecting any one of three building systems: the building envelope, lighting, or heating and cooling systems. The tax deductions are available for systems "placed in service” from January 1, 2006 through December 31, 2013.
For additional information on Federal tax credits for both consumers and businesses, please visit Energy Star.
Helpful Links:
Tax Incentives Assistance Project (TIAP)
Federal Tax Credits for Consumer Energy Efficiency
American Recovery Reinvestment Act of 2009