It’s always a good time to talk about ways to realize some significant savings, and sometimes all you have to do is go green to save some green. Even though some green initiatives may seem to have a higher upfront cost, the IRS continues to offer a variety of tax saving incentives to help balance the burden as well as to reward you for making a few pro-planet upgrades to your home and/or business property.
Since it’s the beginning of the year and we are already open to the idea of making a few changes, we have another one for you to consider. Because Jan. 10 was national cut your engine cost day, we wanted to give you some ideas to help you celebrate the occasion while investing in the long-term sustainability of both your planet and finances.
Planning to install a residential fuel cell and micro turbine system in the near future? Through the end of 2016 you may qualify for a tax credit of 30 percent of the cost of the project, up to $500 per 0.5 kilowatt of power capacity.
Looking to purchase a new car soon? Tax credits are available for all electrical cars. You can visit the DOE’s Fuel Economy website to search what cars are eligible. Based on the vehicle’s battery capacity the credit can be between $2,500 to $7,500.
For Business Owners:
If your business has installed solar panels at company properties, then you may be eligible for up to a 30 percent tax credit for installation and project costs. This credit is available until Dec. 31, 2016.
An energy-efficient commercial building tax deduction allows businesses to deduct certain costs related to making a building energy-efficient rather than capitalize those costs over 39 years. Some improvements that might apply include:
- interior lighting systems
- HVAC systems
- hot water systems
- insulation and exterior windows and doors
But there’s a catch – you have to get a certified licensed engineer to review the project and verify that it meets the IRS’s requirements for a tax deduction. The maximum deduction that can be taken is calculated at $1.80 times the building square footage for property placed into service in 2016.
Finally, if you plan to install a geothermal system, your business may qualify for a 10 percent tax credit.
With rising electric costs, implementing some of these green initiatives can garner you tax savings now and energy cost savings in the future.
Looking to more ways to go green and cut expenses? Email Rea & Associates and ask for more tips.
By Brian Kempf, CPA (Millersburg)