When it comes to clean energy and taking care of your largest asset, it just makes sense to make energy efficient upgrades! Now the Federal Government is making that even easier for you as a homeowner. There are 2 big credits that you need to know about; The Energy Efficient Home Improvement Credit, and the Residential Clean Energy Property Credit. A simple way to know if you are eligible for a tax credit is to see if you have done any of the qualifying upgrades in that tax year.
The EEHI credit is for doors, windows, insulation, HVAC, water heaters, heat pumps, electrical panels to name a few and is limited to $1200/ year. The IRS has a great breakdown of what qualifies for a tax credit.
The other credit is the Residential Clean Energy Property Credit, and that is an unlimited credit for up to 30% of the cost of solar panels, solar water heaters and geothermal heat pumps. There is no overall cap on this credit and you can take advantage of it over several years. For example you add solar panels and a battery backup to your home and spend 50,000 but you get a 15k tax credit. The next year you can add a solar water heater for 10,000 and get $3k in credit. It’s a great incentive to go green!
Another cool option if you just have no idea where to begin is to have a Home Energy Audit where a Certified Energy Auditor identifies the places in your home where you could save more with an energy upgrade and you can claim a $150 tax credit for doing it too. Your local power or gas company should have information to find an auditor in your area.
In my opinion, solar power will continue to be the smartest residential upgrade with the best return on investment. Once the equipment is paid off you will never have a utility bill again, and you can sell power back to the power company, charge your EV or bank your power for an emergency.
If you are curious about the best investments that are green, clean and have a great ROI, get intouch with me. I can help you get an energy audit, pick vendors to help you go green or refer you to a tax planner who knows all about these clean energy tax credits!