Which improvements qualify for the various energy credits?
- June 12, 2018
- David Greene
- Comments Off on Which improvements qualify for the various energy credits?
When you file your tax return, the IRS allows a reduction of tax for any energy efficient improvements you have made. These tax credits can range from adding solar panels to your home to driving an electric car. The Qualified Plug-in Electric Drive Motor Vehicle Tax Credit is the main federal incentive program for electric cars available in the United States. Most electric cars are eligible for this tax credit, which reduces your federal tax burden by $7,500. One of the biggest energy tax credits available to homeowners and businesses in 2018 is the tax credit for solar power. This credit applies both to solar panel systems and solar hot water systems, and is worth 30 percent of the cost of buying and installing the system. This also applies to qualified fuel cell property, qualified small wind energy property, and qualified geothermal heat pumps but the credit for these expenditures can be limited to $500.