However through the Energy Policy Act of 2005 (EPACT), the Federal government offered tax credits and incentives to people who renovated their homes and/or bought alternative-energy vehicles. Many of these credits have ceased to be available; however the home energy efficiency improvement tax credit was extended through December 2008.
This credit is available to any consumer who has made certain improvements to a new home that is the taxpayer's principal residence in the U.S. Eligible are those who install efficient windows, insulation, doors, roofs, and heating and cooling equipment in the home. The net get is up to $500.
Additionally, a taxpayer can claim 30% of qualifying expenditures on qualified photovoltaic property and for solar water heating property used exclusively for purposes other than heating swimming pools and hot tubs. The credit shall not exceed $2000.
Tax preparers can help determine whether taxpayers qualify for such breaks. Clearly this isn't perfect; indeed there is a gaggle of government bureaucrats charged with the job of deciding what defines "energy-saving", and how much that is worth in tax dollars. Nevertheless, a tax credit is a tax credit; and 2008 will likely be a fine year for aggressive tax-write-offs.
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