How Going Green Saves You Green on Your Taxes

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Happy Earth Day! We all know that turning off the lights when you leave a room adds up to big savings on your electric bill. And keeping a moderate finger on the thermostat during the summer and winter months can make a large impact as well.

Not to mention:

  • Recycling
  • Carpooling
  • Rechargeable Batteries
  • Cloth Napkins
  • Compost
  • Repairing Leaky Faucets

But let’s think big – it’s time to consider renewable home energy systems. Nothing says green like renewable energy. And thanks to Uncle Sam, you can save plenty of green with a hefty tax incentive as well.

The IRS tax credit for renewable energy solutions for your home covers up to thirty percent of the cost of residential solar fuel cells and wind turbine systems. However, to get the credit, the energy system must be for your primary residence – rental properties cannot claim this credit.

Energy Efficiency Tax Credit

If you’ve made energy efficient improvements to your home, you can claim this credit good for up to $500 of the cost of materials and installation. Purchases and installations that allow you to claim the Residential Energy Efficiency Tax Credit include high efficiency:

  • Heating Equipment
  • Cooling Equipment
  • Water Heater
  • Insulation
  • Windows
  • Heat-Reducing Roof materials
  • Biomass Stoves
  • Attic and Whole House Fans

Electric Cars and Credits

There’s good news if you’ve purchased a full electric or plug-in hybrid vehicle…good news in the amount of a $2,500 – $7,500 tax credit. Nothing says going green like driving green. And when you drive green, the IRS wants to give you back some green.

Federal Tax Credits for All-Electric and Plug-in Hybrid Vehicles cover vehicles that were manufactured by a certified car maker, not vehicles that have been converted to electrics or hybrids. Also, this credit doesn’t cover golf carts or go karts. A full list of credit amounts and requirements can be found at the government’s fuel economy website.

There are so many tax credits for being green and energy-efficient, they couldn’t all fit in one article. Head on over to Turbo Tax and find out for yourself just how easy it is to save some green when you decide to go green and do your taxes.

You can save so much money on your taxes, it just might be easy to be green after all.  Still need to file your taxes?  If you made any of these energy efficient improvements last year, don’t worry about knowing how to figure out energy tax credits.  TurboTax will figure them out for you and give you the tax credits you deserve based on your entries.

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