Flagging Down a 2010 Tax Credit


It’s always a good time to install solar panels, buy an Energy Star rated appliance or swap your clunker for a hybrid. But we all know Federal and state tax credits and grants make it easier to get the gain without the pain.

“Solar systems typically run $20,00 to $30,000 for homes but with the credits, including  new grants coming available in California, you probably won’t spend more than $10,000,” says Noel Cotter of Luminalt, a San Francisco solar electric and thermal contractor.

Cotter directs visitors to his site to various city incentive programs, such as GoSolarSF for low income residential projects, as well as  the California Solar Initiative, a state rebate that when combined with federal tax credits can cover half or more of the system installed in San Francisco. It’s good to locate programs in your own city, whole checking out the federal programs.

Here are a few credits to entice you:


Home Energy Efficiency Improvement Tax Credits

U.S. Department of Energy: Tax Credit of 30% of the cost up to $1,500 (Cash for Caulkers). Encourages home improvements through rebates for  installing energy-efficient windows, insulation, doors, roofs and heating and cooling equipment in existing homes through December 31, 2010. Energy Star has a list of some of the appliances (furnaces, stoves, water heaters) and materials (panels, bulk insulation, metal and asphalt roofing) that qualify for the credits while also giving you great returns in lower energy bills.

Replacing Your Windows: Part of the IRS Stimulus and Recovery package signed into law Feb. 17, 2009: Raises the level of credits for windows, doors and skylights to 30% and increases the lifetime cap to $1500 for installations prior to December 31, 2010. Which windows get a break? They must have a combination of a less than 0.30 or less U-Value and a0.30 or less SHGC (Solar Heat Gain Coefficient). Window manufacturers are stepping up the ad campaigns now to get you to make the switch. You are advised to retain your NFRC certification label with their records, even though you don’t need to submit it with your tax return.


Home Buying Incentive

The Fed: In some cities, it’s challenging if not impossible to live the American dream of owning your first green home, but credits take a bit of the sting out of the process for those who can buy. Congress has extended the $8,000 credit ($4,000 for those filing separately) for first purchases. And an amendment added gifts a $6,500 break to current homeowners who have owned and lived in a home for any five consecutive year period during the last eight years (and must close a sale after Nov. 6, 2009 and before July 1, 2010). Naturally, there are other restrictions. The home’s price tag cannot exceed $800,000 and the income limit for individuals is $75,000 to $125,000 and for joint filers, $150,000 to $225,000.

State Incentives: CA Franchise Tax Board: States like California are desperate to stimulate the economy. That is why Governor Arnold has proposed extending and expanding the $10,000 homebuyer tax credit to include the purchase of existing homes in addition to new homes for first time buyers. The buyer must be a dependent and must buy a home that doesn’t belong to a family member. The tax board will extend the credit to buyers until the $200 million dollars in tax credits have been used up. Check with your state and learn what is being proposed to get taxpayers back on track.

Green Jobs, Too: California green industries putting jobs in place by 2014 could get in on hundreds of millions of dollars in tax credits as part of President Obama’s $2.3 billion package to stimulate new clean energy jobs.



Buying or Leasing a Hybrid Car or Truck

The IRS: For vehicles in service purchased on or before December 31, 2010 that are primarily driven in the U.S. The amount of credit on new hybrid gas-electric cars or trucks depends on the fuel economy and weight of the vehicle. Sadly, Toyota and Honda hybrids no longer qualify. Hybrids that apply are those using less fuel than the average vehicle of a similar weight that meets an emissions standard qualify. These tax credits are phased out once the manufacturer has sold 60,000 eligible cars and trucks. A summary of the credit requirements for these cars is provided here. Various 2010 models can be found here.

Hybrid Cars says the biggest impact on green cars is the new tax credit for low-speed neighborhood electric vehicles, electric motorcycles, and three-wheeled vehicles. NEV’s – which cannot go faster than 25 mph – can earn the buyer a credit of up to $2,500, and has been slammed as “pork for golf carts.” Tesla Roadsters and a small number of other costly low-production plug-ins qualify.

Images: waynenf, jurvetson, Ian Muttoo, pfala


Luanne Bradley

Luanne Sanders Bradley is the West coast Editor at EcoSalon and currently resides in San Francisco, California.