Certain solar-powered improvements are eligible for a tax credit

You are allowed a credit for 30 percent of certain expenditures that increase the energy efficiency of your personal residence. Costs eligible for the credit include qualified solar electric property expenditures, qualified solar water heating property expenditures, and qualified fuel cell property expenditures. The credit is available for residential energy-efficient property placed in service in 2006, 2007, and 2008. There is no requirement that property be new to qualify.
Qualified solar water heating property expenditures are expenditures for property to heat water for use in your residence if at least half of the energy used is derived from the sun. Qualified solar electric property expenditures are expenditures for property that uses solar energy to generate electricity for use in your home. Qualified fuel cell property expenditures are expenditures for qualified fuel cell property installed on or in connection with your home. Costs for labor properly allocated to the onsite preparation, assembly, or original installation of qualifying property and for piping or wiring to interconnect such property to the dwelling unit are also considered qualifying expenditures. Expenditures for swimming pools and hot tubs do not qualify.

The maximum credit allowed for any tax year is $2,000 for any qualified solar electric property expenditures or qualified solar water heating property expenditures, and $500 for each half kilowatt of capacity of qualified fuel cell property for which qualified fuel cell property expenditures are made. If your allowable credit exceeds your tax liability, the excess can be carried over to the next year.

If your home is jointly occupied and used during the year as a residence by two or more individuals, the maximum amount of qualifying expenditures that may be taken into account by all the owners is:
  • $6,667 in the case of any qualified solar electric property expenditures;
  • $6,667 in the case of any qualified solar water heating property expenditures; and
  • $1,667 in the case of each half kilowatt of capacity of qualified fuel cell property.

Tax Tips Small Business

  • Automobile Expenses

    Which is better - deducting the standard mileage rate or actual expenses?

    With the fluctuating cost of gas, it might be a good idea to revisit which tax deduction is the most beneficial - claiming 54.5 cents per mile (2018) or your actual vehicle expenses. Claiming the standard mileage rate is easier. All you have to do is keep track of your business miles and multiply them by the current rate. In addition to the standard mileage rate, you may also deduct the costs for parking and tolls. Plus, if you are self-employed, you can deduct the interest paid on your car loan.

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Small Business Quick Tip

  • Personal Use of Vehicle

    If your business owns a vehicle that is available for an employee's personal and business use, the vehicle is nevertheless considered used 100 percent for business on the business tax return. The personal-use percentage is included on the employee's W-2 as additional compensation.
Saturday, 15th December 2018

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Tax Tips Personal

  • Public Safety Officers Get a Tax Break

    Tax savings for health care costs

    Beginning in 2007, retired public safety officers, or those who have separated from service due to disability, get a tax break for health care costs. If you are a retired public safety officer,

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Personal Quick Tip

  • Qualified Tuition Plan

    It doesn't appear that a college education will get cheaper any time soon. Look into establishing a qualified tuition plan for your children. The earnings in the account grow tax-free. As long as the funds are spent on qualified education expenses, there are no tax consequences. Plus, there may be an added tax benefit at your state level.