Federal and local incentives encourage higher-performance homes
If you’ve been considering making “green” upgrades to your home, now is the time to take advantage of some great tax credits and rebates that can help make your home a little more environmentally friendly. Following are highlights of just a few of the local and federal incentives available for using environmentally-conscious materials and systems and making other home improvements.
• The federal tax credit for residential energy properties applies to solar electric systems, solar water heating systems, fuel cells, small wind energy systems and geothermal heat pumps. A taxpayer may claim a credit of 30% of qualified expenditures for a system that serves at a primary or secondary US residence for the taxpayer. The 2009 stimulus package removed the caps and specific dollar amounts that were previously imposed on these credits.
• A 2008 energy improvement act applies to energy-efficiency improvements to the building envelope of existing homes and toward the purchase of high-efficiency heating, cooling and water-heating equipment for a primary residence. The 2009 stimulus package extended these credits through 2010, and raised the maximum credit from $500 to $1500 per homeowner.
• Montgomery County residents can receive credits for the clean energy they purchase through a Clean Energy Rewards energy supplier or Renewable Energy Certificates (RECs), or that they produce onsite using solar systems. To be eligible for the credit, at least 50% of one’s annual electricity use must come from clean energy sources. • Additionally, Montgomery County residents can receive property tax exemptions of 50% of the total system cost up to $5,000 for heating, cooling and electricity generating systems and $1,500 for hot water supply systems. Excess credits accrued may be carried forward for up to two years.
• Statewide, solar heating and cooling systems are granted a special property value assessment that negates their increased value against conventional systems. Solar photovoltaic and solar thermal systems in contrast are fully exempt from real property taxes under a separate provision in the tax code.
• For more information, visit http://www.energy.maryland.gov/
• According to the District’s Department of Environment, their solar-electric purchase program offers a rebate based on the size of the system installed, and runs through 2012. Rebate amounts equate to about one third of the cost of a typical solar electric system. The owner has six months from the date of approval to complete the installation.
• For more information, visit http://www.green.dc.gov
• Virginia allows any county, city or town to exempt or partially exempt solar energy equipment or recycling equipment from local property taxes. Residential, commercial or industrial property is eligible.
• Virginia also allows a four-day sales tax exemption on certain classes of ENERGY STAR and WaterSense products of $2,500 or less per product, purchased for non-commercial home or personal use. This 100% exemption from the state sales and use tax applies to sales occurring during the special four-day period each October. For certain energy efficient products purchased other times of the year, individuals may claim a deduction of 20% of sales tax, up to $500.
• For more information, visit http://www.dmme.virginia.gov/arra.shtml