Last Chance to Claim Many Residential Energy Tax Credits

Filed in Environmental, Homeownership by on April 13, 2017 1 Comment

Tax Day is right around the corner but it’s not too late to remind your customers about the residential energy tax credits available to both new-home buyers and those who made efficiency improvements to existing homes in 2016.

Since most of the tax credits expired at the end of last year, April 18 is the last chance for builders and home owners to claim these valuable incentives on their 2016 taxes.

The good news is that the tax credits for solar energy systems, in both new and existing homes, remain in place through 2021. That means home owners can receive a 30% tax credit for solar water heaters and solar panels through 2019, with the credit decreasing to 26% for tax year 2020, and then dropping to 22% for tax year 2021.

Home builders can qualify for tax credits if the homes they built in 2016 meet certain efficiency requirements. Find out the requirements in ENERGY STAR’s Tax Credits for Home Builders.

Home owners can learn what qualifies for these expiring tax credits with ENERGY STAR’s helpful guide.

NAHB economist David Logan recently took a look at how these tax credits are being used by consumers, using new data released by the IRS. Interestingly, only claims for solar electric, solar water heating and small wind energy property costs increased in 2014.

Home owners are using the credits less frequently in other areas of efficiency, such as new windows, insulation and heat pumps. This decrease could be attributed to Congress gradually scaling back the credits beginning at the end of 2010.

Learn more about how these tax credits are used in Logan’s Eye on Housing blog post.

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  1. Loren Swanson says:

    In some upper areas of the country, the solar tax credit is not as useful with more cloudy days. We used more of the geothermal tax credit to lead owners to install those systems at less operating costs. However the first cost is high enough that many will not go to that end. the tax credit made quite a bit of difference when we had one to offer. Is this not something we want the USA to promote or not?

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