Energy Tax Credits for 2014

Last updated on March 12, 2014

With the expiration of the Bush era tax cuts, every taxpayer will be paying more in taxes. However, you can reduce your tax bills by making use of tax credits. If you purchased alternative energy equipment for a qualified residence, then you can use a tax credit of up to 30 percent of the cost of all qualifying improvements you made. Equipments that qualify include solar hot water heaters, and solar electricity equipment and wind turbines. This tax credit is called the Residential Energy Efficient Property Credit can be used until December 31^st, 2016.

Tax credits for alternative energy vehicles (AFVs) can also be used in 2014. This is a one-time use only tax credit. If you purchase a new equipment manufacturer AFV, then you can get a credit for 50% of the incremental cost of the purchase. This tax credit is not available for electric vehicles or converting a vehicle to work on an alternative fuel. You can only claim this credit if you purchase a new and original alternative energy vehicle.

If you haven’t claimed the tax credit for the purchase of a new AFV, you can claim a tax credit of 10% of the total cost of the vehicle, or up to $1,500, when you sell it or if the incremental cost of the vehicle cannot be determined. This tax credit will stay in effect until December 31^st, 2019.