Energy savings rebate programs for Alabama homeowners
With tax season upon us,
Alabama homeowners are looking for ways to offset their federal and state
income tax returns through energy savings rebates.
Both the state of Alabama
and the federal government want to encourage homeowners to invest in energy
efficient home improvements that reduce energy and natural resource
consumption. Homeowners have a twofold incentive for making energy efficient
upgrades around the house: immediate savings through monthly bills and tax
benefits at the end of the year.
Alabama homeowners may be
able to take advantage of 2012 home improvement income tax deductions, and they
can also begin to plan for energy-related home improvements — and additional
tax breaks — for 2013.
2012 home energy
efficiency improvement tax benefits
Federal tax credit. In 2012 and 2013 homeowners can take deductions on
qualified Energy Star-approved investments in existing homes on their federal
income tax returns through the Federal Tax Credit. Visit energystar.gov for
additional information and requirements.
Energy savings upgrades. Homeowners who made certain energy-saving upgrades to
their principal residences qualify for a deduction of 10% of the total cost up
to $500, or a specific amount between $50 and $500. Improvements to doors and
windows, non-solar water heaters, metal and asphalt roofs, insulation, HVAC,
and biomass stoves may qualify.
Energy system modifications. Both principal residences and second homes that modified
or converted to geothermal heat pumps, solar energy systems, or residential
wind turbines can deduct 30% of the total cost of the project. Homes that
invested in fuel cells may deduct 30% of the cost up to $500 per .5 kW of power
capacity.
Alabama state tax credits.
Alabama provides its homeowners with
additional programs, rebates, and state tax deductions for making energy
improvements to existing homes. Visit energy.gov for qualifications and
information on additional programs such as energy efficiency loan programs,
home energy evaluations and new home energy programs.
Planning for 2013 energy
efficiency improvements.
The above tax benefits are
also available in 2013 to tax paying homeowners who make energy efficient
upgrades. Between federal and state tax incentives, Alabama homeowners can
create a high ROI on certain energy-related upgrades, especially after
factoring in their added monthly savings. A range of energy efficiency loan
programs can help offset initial investments while homeowners wait for rebates
and tax returns to come through.
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