Homeowners who are looking for an efficient and reliable alternative to traditional home heating systems can find excellent options with a solar or geothermal system. These two types of renewable energy systems are still eligible for income tax credits provided by the U.S. government. These tax credits for renewable systems can significantly reduce the sometimes costly initial investment in solar or geothermal energy. In combination with the substantial monthly savings provided by these types of renewable energy, the tax credits make it much easier to justify the initial cost of a solar or geothermal systems.
Income tax credits for energy efficiency are available for geothermal energy, solar power, and solar water heating systems. The credits are for 30 percent of the cost of the equipment, with no upper limit. Installation costs for geothermal heat pumps and solar water heaters are included in the credits.
The tax credits are available until the end of 2016. Requirements include:
- The geothermal or solar system must be put into service by Dec. 31, 2016.
- The credit can be applied to solar or geothermal installations in either new or existing homes.
- The system can be used for either a primary or secondary residence.
- Rental properties do not quality for these tax credits.
Household solar installations carry some additional conditions:
Water heating
- At a minimum, half the energy used for water heating must be sun-based.
- The hot water must be used in the residence where the heating system is installed.
- The solar water heating system must be certified by the Solar Rating and Certification Corporation (SRCC).
- Swimming pools or hot tubs do not qualify for the credit.
Photovoltaic electricity generation
- The solar power system must generate energy for use in the household where it is installed.
- The system must comply with local fire and electrical codes.
For more than 36 years, Roth Heating & Cooling has been a leading source of professional heating, cooling, plumbing and electrical services in Portland, Salem, Bend and other communities in Oregon. Contact us today for more information on tax credits for renewable systems and investing in a renewable-energy system for your home will benefit you in both the short and long terms.
