Tax Incentives
Installing geothermal, solar or wind products can not only improve energy efficiencies and save you money on your utility bill, but you can also save a significant amount of money from with federal tax incentives.
The Bottom Line:
A taxpayer may claim a Federal Credit of 30% of qualified expenditures for a system that serves a dwelling unit located in the United States and used as a residence by the taxpayer. If the installation is on a new home, the "placed in service" date is the date of occupancy by the homeowner. Expenditures include labor costs for onsite preparation, assembly or original system installation, and for piping or wiring to interconnect a system to the home. If the federal tax credit exceeds tax liability, the excess amount may be carried forward to the succeeding taxable year. The excess credit can be carried forward until 2016. The maximum allowable credit, equipment requirements and other details vary by technology, as outlined below.
Geothermal Heat Pumps
Solar Electric
Solar Thermal Water Heating
Small Wind Energy Property
The Bottom Line:
- 30% Federal Tax Credit for the total installed cost of Solar, Geothermal and Wind with no maximum limit.
- 25% New York State Tax Credit for the total installed cost in addition to the Federal tax credit for Solar-Electric/Thermal and Wind. There is a $5,000 limit.
- All systems must be place in service by December 31, 2016
A taxpayer may claim a Federal Credit of 30% of qualified expenditures for a system that serves a dwelling unit located in the United States and used as a residence by the taxpayer. If the installation is on a new home, the "placed in service" date is the date of occupancy by the homeowner. Expenditures include labor costs for onsite preparation, assembly or original system installation, and for piping or wiring to interconnect a system to the home. If the federal tax credit exceeds tax liability, the excess amount may be carried forward to the succeeding taxable year. The excess credit can be carried forward until 2016. The maximum allowable credit, equipment requirements and other details vary by technology, as outlined below.
Geothermal Heat Pumps
- The geothermal heat pump must meet Federal Energy Star program requirements in effect at the time the installation is completed.
- The home served by the system does not have to be the taxpayer’s principal residence.
Solar Electric
- The home served by the system does not have to be the taxpayer’s principal residence.
Solar Thermal Water Heating
- Equipment must be certified for performance by the Solar Rating Certification Corporation (SRCC) or a comparable entity endorsed by the government of the state in which the property is installed.
- At least half the energy used to heat the dwelling's water must be from solar in order for the solar water-heating property expenditures to be eligible.
- The home served by the system does not have to be the taxpayer’s principal residence.
Small Wind Energy Property
- The home served by the system does not have to be the taxpayer’s principal residence.
