Get Credit for Making
Your Home Energy Efficient or Buying Energy-Efficient Products
Taxpayers who made
some energy efficient improvements to their home or purchased
energy-efficient products last year may qualify for a tax credit
this year. The IRS wants you to know about these six
energy-related tax credits created or expanded by the American
Recovery and Reinvestment Act of 2009.
Energy Property Credit. This tax credit is for
homeowners who make qualified energy efficient improvements to
their existing homes. This credit is 30 percent of the cost of
all qualifying improvements. The maximum credit is $1,500 for
improvements placed in service in 2009 and 2010 combined. The
credit applies to improvements such as adding insulation, energy
efficient exterior windows and energy-efficient heating and air
Residential Energy Efficient Property Credit.
This tax credit will help individual taxpayers pay for qualified
residential alternative energy equipment, such as solar hot
water heaters, solar electricity equipment and wind turbines
installed on or in connection with their home located in the
United States and geothermal heat pumps installed on or in
connection with their main home located in the United States.
The credit, which runs through 2016, is 30 percent of the cost
of qualified property. ARRA removes some of the previously
imposed annual maximum dollar limits.
Plug-in Electric Drive Vehicle Credit.
ARRA modifies this credit for qualified plug-in electric drive
vehicles purchased after Dec. 31, 2009. The minimum amount of
the credit for qualified plug-in electric drive vehicles, which
runs through 2014, is $2,500 and the credit tops out at $7,500,
depending on the battery capacity. ARRA phases out the credit
for each manufacturer after they sell 200,000 vehicles.
Electric Vehicle Credit. This is a special tax
credit for two types of plug-in vehicles — certain low-speed
electric vehicles and two- or three-wheeled vehicles. The amount
of the credit is 10 percent of the cost of the vehicle, up to a
maximum credit of $2,500 for purchases made after Feb. 17, 2009,
and before Jan. 1, 2012.
Credit for Conversion Kits. This credit is equal
to 10 percent of the cost of converting a vehicle to a qualified
plug-in electric drive motor vehicle that is placed in service
after Feb. 17, 2009. The maximum credit, which runs through
2011, is $4,000.
Treatment of Alternative Motor Vehicle Credit as a Personal
Credit Allowed Against AMT. Starting in 2009,
ARRA allows the Alternative Motor Vehicle Credit, including the
tax credit for purchasing hybrid vehicles, to be applied against
the Alternative Minimum Tax. Prior to the new law, the
Alternative Motor Vehicle Credit could not be used to offset the
AMT. This means the credit could not be taken if a taxpayer owed
AMT or was reduced for some taxpayers who did not owe AMT.
Residential Energy Credits
Energy Provisions of the American Recovery and Reinvestment
Act of 2009
Energy Tax Credit-Claim It- 2011