Energy Tax Credits - 2011 - Wind Energy
In today's environment of rising energy costs and worry about pollution and climate change, more and more homeowners are looking to renewable energy to supplement or replace their home's traditional energy sources.
Harnessing the energy from the wind is quickly becoming one of the most popular forms of renewable energy for homes. While wind energy systems are quite expensive at this time, the federal government is offering a generous tax credit to homeowners who add a wind energy component to their home's energy profile.
Energy Tax Credit for Wind Energy Systems
The current federal energy tax credit for wind energy systems is 30% of the total cost of the installed wind energy system, with no upper limit.
The tax credit is available on principal or secondary homes, and for new or existing homes.
Requirements of Wind Energy Systems for Tax Credit Qualification
The requirements to qualify for the wind energy tax credit are simple:
- The 'nameplate capacity' of the installed wind energy system cannot be more than 100 kilowatts. This is the rated amount of energy the wind system can produce.
- The tax credit includes the cost of installation.
- The wind energy system must be placed in service by December 31, 2016.
How to Apply for the Energy Tax Credit for Wind Energy Systems
Assuming your solar energy system meets the requirements listed above, you will need to file the IRS Form 5695 and submit it with your tax return. On the 1040 form, the residential energy tax credit (from Form 5695) is claimed on line 52.
Save all receipts (or copies) from purchased products and the Manufacturer's Certification Statement for your records. This is a signed statement from the manufacturer certifying that the product or component does in fact qualify for the tax credit.
Manufacturers should provide these certifications on their website. Reputable contractors should be able to assist you with obtaining these certification statements, as well as assist you with complying with the tax credit requirements. With anything tax-related, your tax return preparer can also assist you with any questions you have regarding the energy tax credits.
Submit Form 5696 with your taxes.
Replacing some or all of the nonrenewable, polluting energy sources that power your home with renewable power from wind or solar is an excellent, and very visible, way to reduce your home's environmental footprint. With the tax credits offered by the federal government, switching to renewable energy is made more affordable than ever.