There are numerous ways in which you may recognize savings by way of green tax deductions. By making certain eco-friendly choices regarding your purchases or certain home modifications, you may be eligible for tax benefits while at the same time doing something good for the environment. Not only might the environment and your pocketbook be thanking you for your efforts, but you may be improving your home and lifestyle in the process. In many instances, you could be saving 30% of the cost of your purchases or up to a total tax credit of $1500, although certain purchases may not be governed by this limit.
Heating a Cooling Options
Before you run out and buy a new addition to your HVAC system, you should ensure the product you want to purchase falls within the guidelines of the green tax deduction requirement by visiting www.energystar.gov. Items such as biomass stoves (stoves that burn biomass fuels), certain hot water heaters, geothermal heat pumps, air conditioning units, furnaces, and boilers could be included in the tax deduction, but you don’t want to spend a bundle of cash on a new unit only to realize that it isn’t eligible for the deduction you were expecting. Furthermore, installations of items such as solar panels and wind turbines which actually generate energy for your home can qualify for up to a 30% federal tax credit.
There are a variety of home improvements for which you may be eligible when it comes to tax deductions. Work to improve heating and cooling efficiency through fixing cracks and aging seals in your home and the replacement of insulation are simple ways of reducing energy costs in your home while possibly making yourself eligible for a tax deduction in the process.
You may also realize tax savings in the form of energy efficient window replacement, door replacement, roof replacement, other energy loss reduction repairs or modifications, and even the installation of solar panels.
Tax breaks are not limited to the renovation of dated homes. If you’ve built a new more energy-efficient home before January 1st you may be eligible for tax incentives. According to the Energy Policy Act of 2005, if you’ve build a new home that is 50% more in energy savings over the minimum standard you could qualify for a $2000 tax credit. Those homes which achieve just 30% more energy savings over the standard are still eligible for $1000 tax credit.
Tax deductions can be a great benefit for making environmentally friendly decisions. However, it is important that you fully understand how these deductions apply to you and your situation and ensure that you are making the proper purchases and eco-friendly modifications to meet the guidelines to be eligible for these deductions. It might be helpful to visit the Energy Star website at www.energystar.gov to learn more about available tax credits and terms. If you are still unsure whether the improvements or purchases you are interested in making will result in tax benefits, you may want to consult a tax professional before committing yourself and your money.
U.S Environmental Protection Agency. U.S. Department of Energy. Improve Your Home’s Efficiency & Earn Tax Credits. November 16, 2010. https://www.energystar.gov/about/federal_tax_credits. December 24, 2010.
Anastacio Mindiola is an accomplished attorney and business owner. His company helps home and business owners protest property taxes in Houston and the surrounding counties. For more information on how you can lower your property taxes visit https://www.republicpropertytax.com/.
- Final Days to Donate for Tax Deduction (doyourpart.com)