Federal - Internal Revenue Service - Residential Energy Conservation Subsidy Exclusion
Applicable Sectors: Multi-Family Residential,
Residential,
According to Section 136 of the IRS Code, energy conservation subsidies provided by public utilities, either directly or indirectly, are nontaxable: "Gross income shall not include the value of any subsidy provided (directly or indirectly) by a public utility to a customer for the purchase or installation of any energy conservation measure."
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Federal - Internal Revenue Service - Residential Solar and Fuel Cell Tax Credit
Applicable Sectors: Residential,
Note: IRS Form 5695 & Instructions: Residential Energy Credits for Tax Year 2007 are now available. Also note that the federal tax credits for home energy-efficiency improvements under 26 USC § 25C expired on 12/31/07, but the solar and fuel cell tax credits are available through 12/31/08.
The Energy Policy Act of 2005 (H.R. 6, Sec. 1335) established a 30% tax credit up to $2,000 for the purchase and installation of residential solar electric and solar water heating property. An individual can take both a 30% credit up to the $2,000 cap for a photovoltaics system and a 30% credit up to a separate $2,000 cap for a solar water heating system. A 30% tax credit up to $500 per 0.5 kilowatt (kW) is also available for fuels cells. Initially scheduled to expire at the end of 2007, the tax credits were extended through December 31, 2008, by Section 206 of the Tax Relief and Health Care Act of 2006 (H.R. 6111).
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