Energy Tax Incentives

A new web site from the Tax Incentives Assistance Project (TIAP) is designed to help individuals and businesses cut their federal taxes and their energy bills in 2006 and 2007 by becoming more energy efficient. The site, www.energytaxincentives.org, provides information on new federal income tax incentives in the Energy Policy act of 2005.

Under the energy act, consumers and businesses can receive tax incentives for specific energy-efficiency upgrades to homes and commercial building, including home insulation and window and commercial building lighting improvements. The law also authorizes tax credits for hybrid vehicles, efficient appliances, heating and cooling systems, solar energy systems, and high-efficiency new home and commercial building construction.

Consumer Incentives

Home Shell: Insulation, Windows, Sealing

Homeowners can get credits for energy improvements to their homes, such as windows, insulation, and envelope and duct sealing.

Home Heating and Cooling Equipment

Homeowners can get credits for installing efficient air conditioners and heat pumps; gas or oil furnaces and furnace fans; and gas, oil, or electric heat pump water heaters in new or existing homes.

Passenger Vehicles

Credits are available to buyers of hybrid gasoline-electric, diesel, battery-electric, alternative fuel, and fuel cell vehicles.

Solar Energy Systems

Credits are available to homeowners and businesses who install qualifying solar equipment including photovoltaic cells and solar water heating systems.

Fuel Cells

Credits are available to homeowners and businesses who install qualifying systems. Fuel cells are an advanced technology to generate electricity at the site of use, but they are expensive for commercial buildings and are not widely available for homes.

Business Incentives

Commercial Buildings

Businesses can get deductions for new or renovated buildings that save 50% or more of projected annual energy costs for heating, cooling, and lighting compared to model national standards, and partial deductions for efficiency improvements to individual lighting, HVAC and water heating, or envelope systems.

Commercial Vehicles

Credits are available to businesses as for consumers, including heavy-duty hybrid gasoline-electric vehicles.

Solar Energy Systems

Credits similar to the consumer credits are available to businesses that install qualifying solar equipment.

Fuel Cells and Microturbines

In addition to a fuel cell credit like that for consumers, credits are available to businesses who install qualifying microturbines. These systems, which typically run on natural gas, are small power-producing systems sized to run small to medium size commercial buildings.

Click here to learn more and visit www.energytaxincentives.org

Source: American Public Power Association.

©2005-2007 (TIAP) Tax Incentives Assistance Project. All rights reserved.

*While we have made great effort to describe these tax incentives accurately, we cannot provide tax advice and suggest you contact a tax professional with any questions specific to your situation.