Watch Related Videos
comments
The federal tax energy credit is a tax incentive program offered by the government to businesses, homeowners, and consumers who purchase and use energy efficient products. The said tax break can help minimize the amount of taxes owed by an individual or a company to the federal government.
Eligible Consumer Items/Products
The government established a list of consumer products that are qualified for the federal tax credits for energy efficiency. Homeowners who plan to upgrade their home can receive a tax credit of 30% for choosing energy efficient windows, doors, insulation, roofing, heating, ventilation and air-conditioning system (HVAC). The maximum credit is $1500.
The installation of solar energy system, geo-thermal heat pumps, solar water heaters, small wind energy system, and fuel cell system can be given a tax credit of 30% of the cost of each item.
Furthermore, businesses and individuals who purchase hybrid gas-electric cars and vehicles that use alternative fuels can also benefit the energy tax credit. For this category, the amount of the credit tax payers can gain depends on the vehicle's weight, technology, and the fuel economy. Meanwhile, owners of plug-in electric vehicles can receive a tax credit of $2,500 to $7,500.
Businesses Tax Breaks
Companies that operate using energy-efficient equipment and facilities also benefit the federal tax energy credit. The use of renewable energy like wind, geothermal, refined coal, as well as the application of alternative fuels like compressed natural gas, biofuel, and biomass are some of the energy-conservation alternatives qualified for the tax break.
