Whether or not you were farsighted enough to invest in energy conservation during the past year, there may be some good news come tax time. Both the Federal government and Montana state offer homeowners tax breaks for improving energy efficiency. In addition, many utility companies offer rebates for conservation. Homeowners who have taken a deduction on their Federal tax credits in year’s past may find there are a few changes since last year. And if you haven’t yet upgraded the efficiency of your home, don’t despair. The 2009 tax year comes with new tax breaks.
Federal tax credits can help homeowners who have installed solar panels or fuel cells during the past year. The credits are applied 30% of the cost, although there are caps on the total amount applicable for a credit. There are still Federal tax credits for the installation of solar, wind, and fuel cell systems. There are deductions allowed for a variety of alternative fuel vehicles, including a new tax credit for plug-in electric hybrid cars, which will underwrite up to $7,500 of the purchase price.
In previous years homeowners could also get Federal tax credits for improving the energy efficiency of their homes, including such things as upgrading windows and doors, purchasing more energy efficient furnaces and air conditioners, and adding insulation to roofs, walls, and water heaters. This tax credit covered 10% of the purchase price for these improvements, but expired at the end of 2007, so any improvements made during the 2008 tax year do not qualify. The good news is that the tax credits have been renewed for 2009, now may be a good time to consider upgrading.
The state of Montana offers homeowners a variety of tax breaks for undertaking a wide variety of energy conservation projects. The Montana Dept of Public Health & Human Services administers the Low-Income Energy Assistance Program (LIEAP), which provides help with utility bills and weatherization costs to both homeowners and renters. In order to qualify for this program, your income should be less than 175% of the Federal poverty level. A family of 4 making less than $37,100 qualifies for the program.
The state of Montana now offers a 25% credit to promote a wide variety of energy improvements, including new doors, windows, insulation, weatherstripping, caulking, water heaters and furnaces. A couple who own their home jointly can receive up to $1,000 in rebates under this program. To qualify you will need to complete Form ENRG-C.
A similar tax credit is also available for installing alternative energy systems such as pellet stoves, wind and solar systems, and others. Form ENRG-B. Businesses can qualify for credits related to residential installation of geothermal
Various utility companies have programs to help conserve energy. Northwestern Energy’s e-plus program offers rebates for everything from purchasing compact fluorescent light bulbs to purchasing programmable thermostats. They also offer rebates for the purchase of Energy Star rated appliances and conversion of electric furnaces to gas-fired. Also new home rebate, insulation, efficient water measures.
Montana Dakota Utilities has several different incentive programs that promote installation of programmable thermostats, efficient Energy Star gas furnaces, commercial lighting programs, Their electrical incentive program helps defray the cost of replacing an inefficient air-conditioner with an Energy Star one. They also have a commercial lighting incentive that assists commercial establishments install more efficient lighting.
The Montana Electrical Cooperative Association (MECA) supports Energy Share of Montana, a non-profit organization that raises donations to help pay power bills for low-income homeowners and renters. Much of the funding for this program comes from the Universal Systems Benefit (USB) program, which distributes funds contributed by electrical cooperatives, utility companies, mining and petroleum companies, and large users of electricity.