By David Pilley on February 3, 2011
.jpg.aspx?width=75&height=75) “Going green” is a philosophy that continues to grow. With the concept of “global climate change” as a universally accepted idea, people are taking more strides to conserve and preserve. Finding alternative fuel sources and relying less on petroleum is something most of the world is looking into doing. Whether or not you believe in environmentalism, you should be aware of its incentives. Some things you purchase for your home may qualify for an energy tax credit, and you could be paying less money to the IRS if you notify them properly.
You will be rewarded much more, however, if you took the steps before Jan. 1, 2011. For example, the purchase of a hybrid car could have netted you anywhere between $500 and $3,000 in savings. Fueleconomy.gov gives reliable information on specific hybrid vehicles and the tax credits you could receive. For example, if you purchased a 2009 Chrysler Aspen hybrid or a 2009 Dodge Durango, and you did so before Jan. 1, you are eligible for a $2,200 credit when you file your taxes for 2010.
Some installations to your home could have also given you a tax credit. Any of these installments would give you a 30% credit, up to $1,500: a biomass stove; an advanced main air circulating fan; adequate insulation; a metal or asphalt roof; a gas, oil, electric, or propane water heater; or energy-efficient doors, windows, or skylights. Any of these installations could mean using less energy and having fewer taxes to pay. Keep in mind that the tax credit does not include installation costs of a new roof, insulation, or windows and doors, although you can install the insulation and still be eligible for a tax credit.
If you purchased a hybrid car after Dec. 31, 2010, you don’t currently qualify for a tax credit. However, if you get installations for your home before the end of 2011, you could still be eligible for a tax credit next year. The amount will be much less, a 10% credit (up to $500) or a specific amount between $50 and $300. It’s not much, but it’s still better than nothing.
If you have made these purchases or installations and you’re going to report this to the IRS for a tax credit, you need to file the IRS Form 5695 alongside your 1040 form. The residential energy tax credit is claimed on line 52 of your 1040 form.
One more piece of information to note involves cars. There are a few electric cars that have recently been released: the 2010 CODA Sedan, the 2011 Nissan Leaf, the 2008-10 Tesla Roadster, and the 2011 Wheego Whip LiFe. These cars are all pretty expensive (at least $32,000, with the Roadster in excess of $100,000), but if you purchase any of these cars, you will get a $7,500 tax credit. I know not everyone can afford them, but if you can and you are looking for a tax credit, these cars are all eligible. Environmentalism is not going away, thanks to incentivizing. If you want to take any of these steps to get a tax credit, by all means go ahead. Of course, you might want to wait until the blizzard is over to get a new roof on your house.
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