Tuesday, February 23, 2016
It pays to go green, literally.
As of January 1, 2015, the Residential Energy Efficiency Tax Credit has been restored, and the Residential Renewable Energy Tax Credit has been extended. That means that those who installed energy efficient products in their home during 2015, or plan to in 2016, could actually get a break on their taxes.
Of course, the tax credit is only applicable on qualifying home improvements. It doesn’t hurt to look at the lists below to see if your upgrades qualify, especially since the tax credit could amount to 40% of the install cost.
Residential Energy Efficiency Tax Credit
Eligible products include:
. Heating, cooling, and water heating equipment
. Advanced main air circulating fan
. Electric heat pump and water heater
. Biomass stoves
. Central air conditioner
. Natural gas, propane, oil water heater, oil furnace, or hot water boiler
. Building envelope renovations
. Roofs – pigmented roofs designed to reduce heat gain, and asphalt roofs with cooling granules
. Exterior doors and windows, including skylights
. Insulation materials and systems
To be eligible for the tax credit, each of these products has precise requirements; so be sure to review the Residential Energy Efficiency Tax Credit requirements prior to making a claim on your 2015 taxes or executing a new project in 2016.
Residential Renewable Energy Tax Credit
For all renewable home energy projects, those tax credits have recently been adjusted. For electric property and solar water heating property, the 30% tax credit has been extended through 2019.
In terms of fuel cell property, small wind energy property, and geothermal heat pumps, there has been no change to the tax credits. The 30% tax credits are only eligible for qualified expenditures, with no maximum credit (minus fuel costs), and expire at the end of 2016. Please review the Residential Renewable Energy Tax Credit for more on the requirements for details on each credit.
To learn more about the ins-and-outs of tax the tax credits, ENERGY STAR provides a summary of the credits and tax credit frequently asked questions. If you installed a system in 2015 and are claiming credit on your 2015 taxes, these resources will be highly important.
When taking on a large home energy project, check in with The Energy Experts of Pro Energy Consulting each month for more valuable information on these crucial topics.
With the global climate continuously changing, consumers are seeking alternative energy sources to decrease their carbon footprint and ecological impact. Aside from going green, consumers are adopting renewable energy sources like solar power to take advantage of its reduction in carbon emissions and substantial utility savings.
Adopting alternative energy solutions is not only beneficial for the environment, but it’s also a brilliant financial investment for the future. Governments, businesses, and homeowners are rapidly investing in solar energy, but solar energy isn’t a suitable fit for everyone. To determine if solar energy is the right fit for your home, consider the following before making a future investment.
Location – Solar panels require a lot of natural sunlight in order to function, so if you happen to live in an area that has dense cloud coverage, solar panels may not be the wisest decision. To help consumers determine the solar situation of their specific location, there are plenty of resources online.
Roof Design – If your home’s roof will need to be replaced within the next 15 years, many contractors will not install solar panels. Other roof related obstacles that pose issues include steep pitches, flat roofs, and trees that restrict sun exposure. The ideal roof for solar panels faces south and is constructed of composite shingles or concrete tile. Before installation, consult with a solar expert to determine if your roof can accommodate solar panels.
Your “Green Living” Status – If you’re currently making eco-friendly choices, then deciding on solar panels is a step in the right direction. The average SolarCity solar power system will:
- Offset 178 tons of carbon dioxide over 30 years, that’s equivalent to the amount of fuel it takes to drive 390, 300 miles which would get you around the equator about 15.7 times.
- Conserve so much water used in electricity production that it could fill 6.7 Olympic-sized swimming pools.
- Eliminate the need to burn 174,907 pounds of coal.
Cost – According to the experts at Sunrun, the total cost of solar installation ranges between $15,000 to $29,000. That that is for an average sized system between 4kW and 8kW. Luckily state tax breaks and other government financial incentives are in place to soften the financial blow. Additionally, companies like SolarCity and Sunrun offer financing on products and don’t require a down payment so you can convert your home without spending a dime upfront. Beyond lucrative financing, government incentives, and lower utility bills, consumers who implement solar energy solutions increase the value of their home tremendously. For the average installation in 2015, solar panels added $20,194 in value to the sale price of the house based on repeat sales data from Forbes.
Prior to investing in solar panels, it’s important to consider your location, roof design, green living status, and the cost prior to making an investment. By gradually developing simple steps towards decreasing your energy consumption and carbon footprint will help reduce pressure on your wallet, and the environment.