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Global warming, dependence on foreign oil, high energy prices--yikes--one can't help but look for ways to conserve energy. Fortunately, the U.S. Congress thinks the same way. New tax laws provide three, sweet tax credits for taxpayers who make their principal residences more energy efficient in 2006 or 2007. 100% Energy Credit on Heating & Cooling Appliances Homeowners can use 100% of the cost of energy efficient heating and cooling appliances such as heat pumps, water heaters, air conditioners, furnaces, and fans as a tax credit. A little wrinkle complicates the 100% credit however: You can't claim more than a $300 100%-credit for heat pumps, water heaters, air conditioners. You can't claim more than a $150 100%-credit for furnaces. And you can't claim more than a $50 100%-credit for fans. 10% Energy Credit on Energy-efficient Building Components Homeowners also get a 10%-credit on energy-saving upgrades such as for insulation, metal roofs engineered to deflect heat, doors, and exterior windows and skylights. (But note the maximum tax credit available for windows is $200.) Note, though, that taxpayers can't claim more than $500 in 100%- and 10%-credits. If you do a major home renovation project, obviously, you might easily be limited by the $500 ceiling. 30% Solar and Fuel-cell Equipment Credit Homeowners have one other energy tax credit to consider--a 30% credit on solar energy and fuel-cell expenditures. You can claim a tax credit equal to 30% of the price of solar electrical generators up to a maximum credit of $2,000. And you can claim a tax credit equal to 30% of the price of solar water heaters up to a maximum credit of $2,000. You can also claim a tax credit equal to 30% of the price of fuel-cell power plants up to a maximum credit of $500. (A fuel cell converts fuel to electricity.)
Article Source: http://www.solarpanelarticles.com
About the Author: Seattle accountant Stephen L. Nelson CPA is the author of QuickBooks for Dummies and the Budget LLC Formation web site. Contact him at www.budgetllcformation.com Article Source: www.goarticles.com
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