Don’t forget to Get Your Federal Tax Credits
Did you know that Congress passed a bill in 2005 that can provide you a tax credit (that’s a dollar-for-dollar reduction in your tax bill to Uncle Sam!) for items that you may need to purchase for your house or even a new car?
That’s right Congress passed the Energy Policy Act of 2005.
This federal legislation can provide you with up to $500 in tax credits for improvements to your house. Over $3,000 in tax credits for buying a hybrid car, and if you’re a person who wants to help the environment and you install some solar electric panels on your roof or a solar water heater collector on your roof you can get up to another $2,000 for each!!
Wow, where was this bill when I had some home improvements performed on my house two years ago. And if you’re a business owner you can get tax credits too for your building, company vehicles, and The Energy Policy Act provides a variety of tax credits for businesses, homeowners, home builders, appliance manufacturers, and hybrid/fuel efficient automobiles. Some of these tax credits expire in December 2007 while others expire in later years. And even our Congress is looking a spreading these tax credits around to as late as 2015.
So, what do I have to do to get qualify for these tax credits and is it really something I need? Well, this all depends on your needs. If you are a homeowner you can qualify for up to $500 in tax credits if installing new items in your home, they are up to $200 for a new furnace or boiler, another $200 for new windows, and up to $300 for a new air conditioner, or new doors, or a water heater, or insulation.
The maximum tax credit you can claim for your house is $500, except for installing a solar electric system (call Solar PV photovoltaic) or a solar water heating system. Both of these systems can net you another $2,000 each in tax credits.
You can also claim up to $3,400 in tax credits when buying a new hybrid vehicle.
The tax credit is based upon the type of vehicle and how much does fuel savings does the hybrid achieve when compared to its non-hybrid cousin. The more efficient hybrids are going to qualify for the higher tax credits and reports from such distinguish periodicals such as Consumer Reports is saying a Hybrid car costs less than the non-hybrid version after five years this includes all the associated maintenance costs and fuel costs over the life of the vehicle.
Depending upon what type of business you own you can qualify for thousands of dollars in tax credits. If you’re a homebuilder you may qualify for a $2,000 tax credit, and manufactured homebuilders can receive either a $2,000 tax credit or a $1,000 credit.
Congress did not forget the business owner and also provides a tax credit for solar photovoltaic or solar water heating systems and the credit can exceed $2,000. The owner of a commercial building, including apartment complexes, can also claim a deduction (not a tax credit) on new efficient lighting installed at their facility.
Gas station owners can add an Ethanol system at their station and receive thousands of dollars in tax credits. The IRS continues to interpret and release notices to the public describing their interpretation of the congressional bill.
Before buying any new product for your house checkout different websites to obtain updated information on the tax credits, what has changed, and what has recently been released through a Notice.
As Thornton Wilder said its not worth a thing unless its spread around and encouraging young things to grow. Congress has spread around tax credits and incentives for us to help this industry grow lets all do our part and remember there may be a tax credit available to you when you make an improvement to your house or buy a new car.