| The government wants you to go solar or some | | | | company that installs them or supplies them, to see if |
| alternative power. To encourage you they allow your | | | | they meet the minimum requirements. Some air or |
| installation costs on your home solar system to be | | | | water heaters that are very efficient or burn biomass |
| deducted. Of course, they only allow 30 percent of the | | | | also count. The company that installs them or supplies |
| cost to be deducted. It must also be your main house. | | | | them can tell you which products can be covered |
| I've been told that vacation homes also are covered | | | | here. You are expected to have a manufacturer's |
| but the instructions I looked at don't mention that option. | | | | certification document on file, if they ever check on this |
| However, considering the reduced power cost you will | | | | deduction. |
| be paying, it's a good deal. | | | | Within these limitations you can deduct 30 percent of |
| This tax credit covers a broad range of alternative | | | | the installation costs. Most of these are covered with |
| energy projects. For solar you can deduct both solar | | | | no maximum other than the fuel cells. If you have |
| electric power generation and solar water heating. The | | | | excess deductions, you can deduct part this year and |
| solar water heating must provide fifty percent or more | | | | part the next. This bill goes all the way to 2016. But I |
| of the home needs and be approved by your state's | | | | wouldn't recommend waiting too long. Tax rules get |
| organization. Wind turbines are also included in this | | | | changed often. |
| credit. Even geothermal heat pumps meet the criteria. | | | | To get this credit you need to get the Internal |
| Fuels cells are also included but they are limited to 500 | | | | Revenue Service form 5695, Residential Energy |
| dollars per half kilowatt. | | | | Credits. Your tax professional can fill this out for you if |
| Even house improvements that improve energy use | | | | need be. I suggest you look at it first to make sure you |
| can be included. New energy efficient windows, doors, | | | | understand the requirements for reporting. It does not |
| or roofs can be covered. There are requirements on | | | | look very challenging. |
| these for how well they work. Check with the | | | | |