Sun Jul 31,
2005 -
Update from Terry Clark:
The National Energy bill that has already been passed by
both the House of Representatives and the Senate is expected to be passed into
law this coming week by President Bush. While the main body of the bill deals
with the expansion of energy production, there are some hidden gems in there
that could save you hundreds of dollars while you also conserve energy at home
and with your car. The tax breaks will take effect January 1, 2006 so you have
some time to plan to make sure you get the most from the breaks being
offered.
If you have been thinking of making energy efficient upgrades to
your home, waiting a few more months may make sense. The bill allows up to a
$500 tax credit for money spent on energy improvements to your home. This
includes a up to a $300 credit for installing a new highly efficient central air
conditioner, heat pump or water heater. Installing energy-efficient windows
could be worth up to another $200 in credit.
Those that decide to go
solar or to upgrade can also get some tax money back from the government. If you
purchase a solar-powered water heater or any fuel cell equipment for your home,
the bill allows for a 30% tax credit, or up to $2,000.
For those that
need to purchase new appliances, it may also be worth waiting a few months
before doing so since the bill will likely mean lower prices for energy
efficient appliances. While there are no tax breaks for consumers directly,
there are tax breaks in the bill for manufacturers of energy efficient washers,
dryers and refrigerators. The result should be more availability of these high
efficient appliances at lower prices.
Hybrid and alternative fuel cars
also will enjoy a number of new tax breaks. If you are planning on purchasing a
new hybrid or diesel car, waiting until the new year will make you eligible for
tax breaks worth between $500 and $3,400 depending on the car's fuel efficiency.
Alternative fuel cars such as hydrogen and electric will be eligible for tax
breaks of up to $8,000.