I like saving a buck just like everyone else I know and that is one of the reasons I started building solar panels. But now the Federal Government is actually encouraging me to do it. I know, sounds crazy that the Feds would want to help ‘ole Sam out, but they do. They’ve actually put into Law some tax credits that help me and you. Here’s a little information just so you don’t think I’m making this up.

About Tax Credits
This is the part that was a little confusing at first, but basically a tax credit is more valuable than an equivalent tax deduction because a tax credit reduces tax dollar-for-dollar, while a deduction only removes a percentage of the tax that is owed. You can itemize purchases on your federal income tax form, which will lower the total amount of tax you owe the government. Fuel-efficient vehicles and energy-efficient appliances and products provide many benefits such as better gas mileage –meaning lower gasoline costs, fewer emissions, lower energy bills, increased indoor comfort, and reduced air pollution. In addition to federal tax incentives, some people will also be eligible for utility or state rebates, as well as state tax incentives for energy-efficient homes, vehicles and equipment. Each state’s energy office web site may have more information on specific state tax information. See website: Department of Energy – Tax Breaks

Emergency Economic Stabilization Act of 2008
And you thought just those Wall Street boys were “rescued” last year…On October 3, 2008, the House of Representatives passed the Emergency Economic Stabilization Act (EESA) of 2008, which includes an 8-year extension of the solar investment tax credit (ITC) and provides other critical incentives to the renewable energy marketplace. But not only does this new law extend the ITC, it also provides additional provisions that will combine for $18 billion in renewable energy tax credits. Those provisions include credits for solar, wind, and several other clean-energy industries in the United States.

“By passing this bill,” according to Suntech America president Roger Efird, “Congress has finally given the solar energy industry the ‘policy certainty’ that will attract investment, expand manufacturing and lower the cost of solar energy to consumers,” Efird said in a statement.

The solar industry is the greatest beneficiary of this legislation. The tax credits for solar initiatives are good for the next 8 years. Additionally, the $2,000 tax credit limit for residential solar systems being lifted means that homeowners can get a 30% tax credit on the solar panels they install starting next year (That’s 2009!).

So if my math is right for every $100 you spend on solar power, the IRS will give you $30 back on your taxes. Doesn’t get much better than that. Don’t delay any longer, get out there and start building.

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