The Democrats' big tax, climate, and health bill passed by Congress last year includes a number of environmental initiatives that many Americans can take advantage of.
Ten years of consumer tax credits, as well as incentives to buy electric vehicles or hybrid cars, are included in those initiatives. When the act was signed into law in August, some measures took effect, but others were expanded on January 1.
The green initiatives and tax breaks in the bill can be used at home.
Households that outfit their homes with rooftop solar can receive a tax credit to cover 30% of the cost of installation, meaning they can save thousands of dollars. The tax credit can be used to pay for the installation of solar power on your property if you hire a licensed solar installer certified by the North American Board of Certified Energy Practitioners.
Thirty percent of the total cost of the installation can be claimed as a federal tax credit. The average size of a solar system for a home is 5 kilowatts. The claimable tax credit is $6,000.
Unless Congress renews it, the tax credit for solar will end in 2035.
Replacing your gas furnace with an electric heat pump is one way to make a home more energy efficient.
A home energy audit is an evaluation of how much energy your home uses and where it can be improved. Further steps will be recommended by the Auditor. Depending on the size and location of your home, an assessment can be as high as $600. You could do a home energy assessment yourself.
A tax credit of up to $150 is available for an energy audit conducted by a professional inspector. Up to 30% of the total cost can be claimed as a tax credit for any updates done after the assessment.
In the US, more than 10% of carbon emissions come from gas and fuel oil. A heat pump can be up to four times more efficient than a gas furnace. 99% of US homes will be able to reduce their carbon emissions by 2020 if they replace their gas furnace with a heat pump, according to a report by the research group.
A tax credit of 30% of the total cost of buying and having it installed can be claimed by households that install a heat pump.
The cost of a heat pump can be cut by up to $8,000 if a household receives a rebates. If electrical updates are required in order to install heat pumps, households can receive up to $4,000 in rebates. You'll need to research specifics for your state when it comes to these rebate programs, as they vary from state to state.
The new climate bill increased the incentives to purchase electric vehicles.
For new vehicles, individuals who earn less than $150,000, households who earn $225,000, or joint filers who earn less than $300,000 may be eligible for a tax credit. The vehicles have to be made in the US and cost no more than $80,000 for trucks, vans, and SUVs. There is a tentative list of models that would qualify.
Households with incomes that qualify can get a tax credit of up to $4,000 if the vehicle is at least two years old and costs no more than $25,000.