Thom points out Federal and State tax credits for efficient energy systems and appliances
Well, the very dark cloud of the economic De-Cession we have all lived through for the past three years has a silver lining. Energy prices. When economic activity dies and products being manufactured, shipped, and distributed slow from their frenetic pace of the early 2000’s, energy prices fall, and fall they have. Automobile gas is currently about 60% of what it was at its peak, Natural Gas is about a third of what it ran up to, and crude oil is at approximately half its former cost. What does this have to do with Real Estate, you ask?
When fossil fuel prices drop, a similar phenomenon occurs in the renewable, or green, energy industry. Prices on many renewable energy systems go up when more people are rushing to buy them to stave off the specter of high fuel prices, and they also go down when prices in non-renewable energies fall, and people become complacent about buying what is the easiest to get- fossil fuels. However, as we have seen with the stock market since the March 2009 bottom, the best time to buy is not at the peak, but in the trough of prices.
Furthermore, homeowners who install energy efficient systems in their homes in 2010 can cash in on government programs, put in place when energy was expensive and it seemed the Saudis would own the entire World, and get some real money back on their taxes both this year, and for years to come. Everything from Solar electricity systems, so perfect for our High Desert and loads of year-round sun, to wind systems, also perfect for our climate, to simple energy saving appliances has a financial benefit to install and use in your home.
After all, do you REALLY think that low energy prices are here to stay? T. Boone Pickens, who is an oil and wind energy titan, claims that oil will once again double this year to well over $150 a barrel (that means $4 plus gallons of gas to you and me). Now, he is an OIL man, so we can take that with a grain of salt, however, he made similar predictions in 2004, and he proved correct then. And he is not the only one making such claims, as the economic recovery in China charges ahead, while ours begins to start chugging along here in America. Once we get our economy cranked up and join the current booms in Latin America and Asia, and then Europe follows, we could be looking at another massive problem with energy prices right here at home.
Now, the tax credits. The Federal Government has several tax credits, CREDITS, NOT DEDUCTIONS, for homeowners in place for 2010. Through this year, homeowners who install energy efficient products in their homes can get 30% of the total cost of the products back as a tax credit on this or next years’ taxes, UP TO A MAX OF $1500. The items must be in your principal residence, must have been put in service between January 1 2009 and December 31 2010, and include the following items:
Biomass Stoves, HVAC (heating, ventilation, or air conditioning), Insulation, Roofing, Water heaters, and Windows and Doors.
Folks, this is a no brainer. I know many of you have bought fixer uppers in the past year or two as prices have dipped, and if you need a new roof, new vinyl windows to replace old aluminum ones, or a new furnace, NOW is the time to do it. Free money from the government is not just for Big Banks (though yes, it’s a LOT less!)
AND EVEN BETTER, there are some items which HAVE NO UPPER LIMIT, and not only do they qualify for the 30% credit without a limit, they also run through 2016! These items include:
Geothermal Heat Pumps, Solar Energy Systems, Wind Energy Systems, and the new up and comer, Fuel Cells.
Now that’s a credit! Always wanted a solar electricity system on your home, but balked at the cost? Take advantage of lower prices than you will probably find in a a years’ time at the source, and let the government pay 30% of your costs! It’s a great situation for those that need to do some work, and have the seed money to do it.
And, of course, the State of Oregon has a very messy and extensive list of credits for homeowners who install energy efficient appliances and systems as well. It is too sloppy to summarize here, so I am including this link to a page which summarizes them: http://www.oregon.gov/ENERGY/CONS/RES/RETC.shtml , OR, I have included a great chart on the bottom of my “Tax Information” page, HERE.
Lastly, here is a link to the Federal Governments informational site on their tax credits: http://www.energystar.gov/index.cfm?c=tax_credits.tx_index
Now, go save some money!