These are tax CREDITS, not tax deductions. 30% of the cost. Up to $1500 for
small projects, no limit for big-ticket items such as tapping geothermal
And just like last years giant mega subsidies for grinding up food to
make ethanol to keep the SUVs going many are just plain stupid, wasteful
and ill-conceived. But I wouldn't expect anything less from the
government. Our state will transfer your neighbor's and maybe even folks
you don't know money to you for such ridiculous projects as building a
windmill even though we are the second worst place in the US for
windmills. It is about as practical and sensible as awarding grants for
a pineapple farm even though we are in zone 5.
You need to look more closely to see through the hype. I investigated
the claims of "30% tax credit with no limit" for small wind generators
(good excuse to put up a tower here and plenty of wind), but
investigating the actual IRS forms for this showed that the reality is
you can enter 30% of the total project cost on the first line, however
the credit is actually limited to $1,000 per 1kW of system capacity and
capped at $4,000 maximum (IRS form 5695). www.energystar.gov lists the
various credits and links to the IRS forms, so you can see the realities
for the various credits. They do exist and certainly if you are doing
some of these projects you can get some benefit from them, but as usual
they are not as advertised.
It is still starting to become attractive. There are usually state
rebates too. It still won't pay the whole $5-8 per watt these things
cost but you do get a payback from the utility bill you are not
paying. I still doubt the numbers really work until you are out in
year 10 with no intervening maintenance. I am thinking about starting
with something like a solar powered pool pump. That is a pretty steady
bill that is not really a critical application. As long as you get
several hours a day you can get by. I already use a solar pool heater
and that works great for virtually nothing. If running the pump was
free it would be nothing.
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