Energy savings could save taxes

By Staff
Alabamians could be eligible for thousands of dollars in federal tax breaks if they purchase and use approved energy-saving products, according to the Energy Division of the Alabama Department of Economic and Community Affairs.
The tax incentives are part of the Emergency Economic Stabilization Act of 2008. One of the act’s goals is to encourage homeowners to upgrade their homes and conserve energy through the purchase and installation of energy-efficient products.
In 2009, homeowners can earn up to $500 in tax credits for installing insulation, ENERGY STAR windows, heating and cooling systems and reflective roofing.
Homeowners who install solar panels or solar-powered hot water systems are eligible for tax credits of 30 percent of the installed cost, with a $2,000 maximum for water systems. The act also increases the tax credit for geothermal heat pumps to $2,000. The credits are available for systems installed from 2008-2016.
Purchasers of plug-in hybrid vehicles also can receive a break at tax time. To be eligible, the vehicle must have a battery capacity of at least four kilowatt hours, which brings a $2,500 credit. Each additional kilowatt hour of battery life adds $417 to the credit, up to a $7,500 maximum.
For more information, visit www.dsireusa.org and select Alabama on the map or call 800- 392-8098.