As promised, our CPAs, Kositzka, Wicks & Company have lent their expert advice and today’s blog includes details of the federal tax credits and Virginia rebates that await taxpayers who make energy-efficient improvements to their properties.

New Expanded Federal Credits:

Up to $1,500 Credit for Qualified Energy-Efficient Home Improvements in 2009 and 2010

• For improvements to your principal residence (expenses incurred building a new home do not qualify for this credit) located in the U.S. placed in service in 2009 and 2010
• 30% of qualified expenditures up to a maximum total cumulative credit of $1,500
• Qualified Energy-Efficient Home Improvements include the following if the improvements also meet specific energy-efficient guidelines noted below:
  • Metal and Asphalt Roofs
  • Insulation
  • Exterior Windows (including skylights) and Doors
  • HVAC
  • Water Heaters

30% Credit for Qualified Residential Solar Water Heaters, Geothermal Heat Pumps, Wind Energy Property, and Solar Electric Generating Property

• For improvements to your residence located in the U.S. placed in service through 2016 (second homes qualify for this credit)
• 30% of the equipment’s cost (including onsite labor costs) with no capped limit.
• Expenditures related to swimming pools or hot tubs (e.g., solar equipment to heat water or run electrical pumps) do not qualify for this credit

In Order to Claim the Federal Tax Credits

• One must have a Manufacturer Certification Statement
  • Before making energy-efficient improvements to your home, check to see if the manufacturer has certified the products as qualifying for the energy tax credit
  • You can also go to energystar.gov/taxcredits for information on whether your planned improvements will qualify for the credit

Just Announced - Virginia Rebates

Virginia Energy-Efficiency Rebate Program

• For qualified energy-efficient products and equipment purchases made after June 25, 2009
• Rebates will be distributed on a first-come-first-served basis. $15 million is dedicated to this rebate program
• Residential consumers are eligible to receive up to $2,000 per household and up to $250 of the cost of having an energy audit conducted by a certified energy auditor.
• Commercial consumers are eligible to receive a maximum of $4,000, but not to exceed 20% of the total cost.
• Virginians can also receive For a list of qualified purchases and to sign up to be notified when applications are available visit the Virginia Department of Mines, Minerals, and Energy (DMME) website http://www.dmme.virginia.gov/eerebates.shtml.

Renewable Energy Rebate Program

• For installation of renewable energy generation systems, such as solar or wind systems, made after June 25, 2009. $15 million is dedicated to this rebate program
• Rebates are based on capacity of the generating system, for example:
  • Residential consumers can receive rebates for $2,000 per kilowatt of the photovoltaic system up to 10 kilowatts in size. Residential and commercial consumers can receive a $1,000 per kilowatt rebate for solar hot water systems.

For additional information on the tax credits and rebates contact your tax adviser.

Kositzka, Wicks & Company (KWC), certified public accountants, is located in Alexandria, Virginia.  Formed in 1983, KWC was founded with a commitment to provide quality, personal service in a timely manner.  For over 25 years, the staff has grown to more than fifty people, all dedicated to this founding principle. Visit us at www.kwccpa.com.

Circular 230 Disclaimer: Any tax advice contained in the body of this material was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provision