Tax Information
4509 Rowlett Rd.
Rowlett, TX 75088
972-475-0644
972-412-2037, fax
info@lawsoncpas.com
Rowlett, TX 75088
972-475-0644
972-412-2037, fax
info@lawsoncpas.com
LAWSON & CO CPAS, LLC
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Consumer Energy Tax Incentives
What the American Recovery and Reinvestment
Act Means to You
The American Recovery and Reinvestment Act
of 2009 extended many consumer tax incentives
originally introduced in the Energy Policy Act of
Economic Stabilization Act of 2008 (P.L. 110-
343).
See the summary of the energy tax incentives
included in the Emergency Economic
Stabilization Act of 2008.
ABOUT TAX CREDITS
A tax credit is generally 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. Consumers can itemize purchases on
their federal income tax form, which will lower
the total amount of tax they 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
consumers 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.
Below is a summary of many of the tax credits
available to consumers. Please see the
ENERGY STAR® page on Federal Tax Credits
for Energy Efficiency for more details on federal
incentives and the Database of State Incentives
for Renewables and Efficiency (DSIRE) for
information on federal, state, local, and utility
incentives.
HOME ENERGY EFFICIENCY IMPROVEMENT TAX
CREDITS
Consumers who purchase and install specific
products, such as energy-efficient windows,
insulation, doors, roofs, and heating and
cooling equipment in existing homes can
receive a tax credit for 30% of the cost, up to
$1,500, for improvements "placed in service"
starting January 1, 2009, through December 31,
2010. See EnergyStar.gov's Federal Tax Credits
for Energy Efficiency for a complete summary of
energy efficiency tax credits available to
consumers.
RESIDENTIAL RENEWABLE ENERGY TAX
CREDITS
Consumers who install solar energy systems
(including solar water heating and solar electric
systems), small wind systems, geothermal heat
pumps, and residential fuel cell and
microturbine systems can receive a 30% tax
credit for systems placed in service before
December 31, 2016; the previous tax credit cap
no longer applies.
AUTOMOBILE TAX CREDITS
Hybrid Gas-Electric and Alternative Fuel Vehicles
Individuals and businesses who buy or lease a
new hybrid gas-electric car or truck are eligible
for an income tax credit for vehicles “placed in
service” starting January 1, 2006, and
purchased on or before December 31, 2010.
The amount of the credit depends on the fuel
economy, the weight of the vehicle, and whether
the tax credit has been or is being phased out.
Hybrid vehicles that use less gasoline than the
average vehicle of similar weight and that meet
an emissions standard qualify for the credit.
This tax credit will be phased out for each
manufacturer once that company has sold
60,000 eligible vehicles. At that point, the tax
credit for each company’s vehicles will be
gradually reduced over the course 15 months.
See the IRS's Summary of the Credit for
Qualified Hybrid Vehicles for information on the
status of specific vehicle eligibility.
Alternative-fuel vehicles, diesel vehicles with
advanced lean-burn technologies, and fuel-cell
vehicles are also eligible for tax credits. See the
IRS summary of credits available for Alternative
Motor Vehicles.
Plug-In Electric Vehicles
The Recovery Act modifies the credit for
qualified plug-in electric drive vehicles
purchased after Dec. 31, 2009. The minimum
amount of the credit for qualified plug-in electric
drive vehicles is $2,500 and the credit tops out
at $7,500, depending on the battery capacity. To
qualify, vehicles must be newly purchased, have
four or more wheels, have a gross vehicle
weight rating of less than 14,000 lbs, and draw
propulsion using a battery with at least four
kilowatt hours that can be recharged from an
external source of electricity. The full amount of
the credit will be reduced with respect to a
manufacturer's vehicles after the manufacturer
has sold at least 200,000 vehicles. The credit
will then phase out over a year.
Please see IRS Notices 2009-54: Qualified
Plug-in Electric Vehicle Credit (PDF 29kb) and
2009-58: Qualified Plug-In Electric Vehicle
Credit Under Section 30 (PDF 19kb) for more
information (requires Adobe Acrobat Reader).
Plug-In Hybrid Conversion Kits
The Recovery Act also provided a tax credit for
plug-in electric drive conversion kits. The credit
is equal to 10% of the cost of converting a
vehicle to a qualified plug-in electric drive motor
vehicle and placed in service after Feb. 17,
2009. The maximum amount of the credit is
$4,000. The credit does not apply to
conversions made after Dec. 31, 2011. A
taxpayer may claim this credit even if the
taxpayer claimed a hybrid vehicle credit for the
same vehicle in an earlier year.
Please see the IRS website for more
information on Alternative Motor Vehicle Credits.
Low Speed & 2/3 Wheeled Vehicles
The Recovery Act law also creates a special tax
credit for two types of plug-in vehicles - certain
low-speed electric vehicles and 2- or 3-wheeled
vehicles. The amount of the credit is 10% of the
cost of the vehicle, up to a maximum credit of
$2,500 for purchases made after Feb. 17, 2009,
and before Jan. 1, 2012.
To qualify, a vehicle must be either a low speed
vehicle propelled by an electric motor that draws
electricity from a battery with a capacity of 4
kilowatt hours or more or be a 2- or 3-wheeled
vehicle propelled by an electric motor that draws
electricity from a battery with the capacity of 2.5
kilowatt hours. A taxpayer may not claim this
credit if the plug-in electric drive vehicle credit is
allowable. Please see IRS Notice 2009-58:
Qualified Plug-In Electric Vehicle Credit Under
Section 30 for more information (PDF 19kb,
requires Adobe Acrobat Reader).
What the American Recovery and Reinvestment
Act Means to You
The American Recovery and Reinvestment Act
of 2009 extended many consumer tax incentives
originally introduced in the Energy Policy Act of
Economic Stabilization Act of 2008 (P.L. 110-
343).
See the summary of the energy tax incentives
included in the Emergency Economic
Stabilization Act of 2008.
ABOUT TAX CREDITS
A tax credit is generally 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. Consumers can itemize purchases on
their federal income tax form, which will lower
the total amount of tax they 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
consumers 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.
Below is a summary of many of the tax credits
available to consumers. Please see the
ENERGY STAR® page on Federal Tax Credits
for Energy Efficiency for more details on federal
incentives and the Database of State Incentives
for Renewables and Efficiency (DSIRE) for
information on federal, state, local, and utility
incentives.
HOME ENERGY EFFICIENCY IMPROVEMENT TAX
CREDITS
Consumers who purchase and install specific
products, such as energy-efficient windows,
insulation, doors, roofs, and heating and
cooling equipment in existing homes can
receive a tax credit for 30% of the cost, up to
$1,500, for improvements "placed in service"
starting January 1, 2009, through December 31,
2010. See EnergyStar.gov's Federal Tax Credits
for Energy Efficiency for a complete summary of
energy efficiency tax credits available to
consumers.
RESIDENTIAL RENEWABLE ENERGY TAX
CREDITS
Consumers who install solar energy systems
(including solar water heating and solar electric
systems), small wind systems, geothermal heat
pumps, and residential fuel cell and
microturbine systems can receive a 30% tax
credit for systems placed in service before
December 31, 2016; the previous tax credit cap
no longer applies.
AUTOMOBILE TAX CREDITS
Hybrid Gas-Electric and Alternative Fuel Vehicles
Individuals and businesses who buy or lease a
new hybrid gas-electric car or truck are eligible
for an income tax credit for vehicles “placed in
service” starting January 1, 2006, and
purchased on or before December 31, 2010.
The amount of the credit depends on the fuel
economy, the weight of the vehicle, and whether
the tax credit has been or is being phased out.
Hybrid vehicles that use less gasoline than the
average vehicle of similar weight and that meet
an emissions standard qualify for the credit.
This tax credit will be phased out for each
manufacturer once that company has sold
60,000 eligible vehicles. At that point, the tax
credit for each company’s vehicles will be
gradually reduced over the course 15 months.
See the IRS's Summary of the Credit for
Qualified Hybrid Vehicles for information on the
status of specific vehicle eligibility.
Alternative-fuel vehicles, diesel vehicles with
advanced lean-burn technologies, and fuel-cell
vehicles are also eligible for tax credits. See the
IRS summary of credits available for Alternative
Motor Vehicles.
Plug-In Electric Vehicles
The Recovery Act modifies the credit for
qualified plug-in electric drive vehicles
purchased after Dec. 31, 2009. The minimum
amount of the credit for qualified plug-in electric
drive vehicles is $2,500 and the credit tops out
at $7,500, depending on the battery capacity. To
qualify, vehicles must be newly purchased, have
four or more wheels, have a gross vehicle
weight rating of less than 14,000 lbs, and draw
propulsion using a battery with at least four
kilowatt hours that can be recharged from an
external source of electricity. The full amount of
the credit will be reduced with respect to a
manufacturer's vehicles after the manufacturer
has sold at least 200,000 vehicles. The credit
will then phase out over a year.
Please see IRS Notices 2009-54: Qualified
Plug-in Electric Vehicle Credit (PDF 29kb) and
2009-58: Qualified Plug-In Electric Vehicle
Credit Under Section 30 (PDF 19kb) for more
information (requires Adobe Acrobat Reader).
Plug-In Hybrid Conversion Kits
The Recovery Act also provided a tax credit for
plug-in electric drive conversion kits. The credit
is equal to 10% of the cost of converting a
vehicle to a qualified plug-in electric drive motor
vehicle and placed in service after Feb. 17,
2009. The maximum amount of the credit is
$4,000. The credit does not apply to
conversions made after Dec. 31, 2011. A
taxpayer may claim this credit even if the
taxpayer claimed a hybrid vehicle credit for the
same vehicle in an earlier year.
Please see the IRS website for more
information on Alternative Motor Vehicle Credits.
Low Speed & 2/3 Wheeled Vehicles
The Recovery Act law also creates a special tax
credit for two types of plug-in vehicles - certain
low-speed electric vehicles and 2- or 3-wheeled
vehicles. The amount of the credit is 10% of the
cost of the vehicle, up to a maximum credit of
$2,500 for purchases made after Feb. 17, 2009,
and before Jan. 1, 2012.
To qualify, a vehicle must be either a low speed
vehicle propelled by an electric motor that draws
electricity from a battery with a capacity of 4
kilowatt hours or more or be a 2- or 3-wheeled
vehicle propelled by an electric motor that draws
electricity from a battery with the capacity of 2.5
kilowatt hours. A taxpayer may not claim this
credit if the plug-in electric drive vehicle credit is
allowable. Please see IRS Notice 2009-58:
Qualified Plug-In Electric Vehicle Credit Under
Section 30 for more information (PDF 19kb,
requires Adobe Acrobat Reader).
Congress appropriated $300 million nationwide
to support state rebate programs for residential
Federal Amount Available: $300 million, nationally
State Energy Conservation Office (SECO)
Estimated Allocation: $23,341,000
Program Objectives:
Save energy by encouraging appliance
replacement through consumer rebates
Make rebates available to consumers
Enhance existing rebate programs by leveraging
ENERGY STAR national partner relationships
and local program infrastructure
Keep administrative costs low while adhering to
monitoring and evaluation requirements
Promote state and national tracking and
accountability
Use existing ENERGY STAR consumer education
and outreach materials
Program Status:
Initial Applications submitted to the Department of
Energy (DOE) on 8/15/09.
SECO Comprehensive Application submitted to
DOE 10/14/09.
DOE approval announced on 12/11/09.
SECO issued Request for Proposals (RFP) for
Rebate Program Implementation Contractor on
12/28/09. Proposals due by 1/13/10.
Program Details:
Summary: Texas will use approximately $23
million in federal stimulus funds for a mail-in
rebate program for consumers who purchase
certain energy efficient household appliances.
For additional information see our Energy
Efficient Appliance Rebate Program FAQs.
Who Qualifies: The U.S. Department of Energy
approved the rebates for consumers who buy
eligible Energy Star appliances and replace the
same type of old appliance that's functional. The
Texas program will also offer an incentive to
recycle old appliances.
Timing: The mail-in rebates will apply to eligible
appliances purchased between April 16 and April
25, 2010. The 10-day period will coincide with
Earth Day. Offering the program next spring will
give retailers time to stock up on appliances, give
the state time to select a vendor to administer the
rebates, and allow ample time to inform
consumers about details of the rebate program.
NOTE - the rebate program will not be retroactive.
It will only apply to purchases made once the
program officially begins in April 2010.
Rebate Amounts: The rebates will be as follows:
Appliance Rebate With $75 Recycling Rebate
Refrigerator $240 $315
Freezer $180 $255
Room Air Conditioner $45 $120
Clothes Washer $150 or $180* $225 or $255
Dishwasher $110 or $140* $185 or $215
Central Air Conditioner $600 , $800 or $1,000*
$675, $875 or $1,075
Heat Pump $1,200 – $1,600* $1,275 – $1,675
Water Heater $190 – $640* $265 – $715
* Depending on appliance type and energy
efficiency of model purchased
Rebate Process: Consumers will have an
opportunity to reserve an appliance rebate by
calling a toll-free number or registering online
approximately two weeks prior to April 16, 2010.
After the reserved mail-in rebates are awarded,
any remaining funds will be rebated to
consumers on a first-come, first-served basis.
Shoppers will be limited to two appliance rebates
and two recycling rebates per household.
Recycling: Texas plans to include recycling
opportunities of old appliances in the program
design. SECO is also working with retailers and
recycling facilities to create a system to help
consumers replace functional old appliances and
recycle them where available.
Get the latest updates. Sign up for Energy
Efficient Appliance Rebate e-mails.
Related Links:
While consumers are awaiting additional
program details, below are some helpful links.
ENERGY STAR Web site
Federal Tax Credits for Energy Efficiency
Special Offers and Rebates from ENERGY STAR
Partners
Database of State Incentives for Renewables &
Efficiency - Texas Residential Incentives
Legal Authority:
Federal Code: Energy Policy Act of 2005 (PDF, 3.1
MB), Title I, Subtitle B, Section 124 (42 USC
15821)
Request for Proposals (RFP) for Rebate Program
Implementation Contractor:
RFP Title: Energy Efficiency Appliance Rebate
Program for the Stimulus Grant Program
Agency Requisition Number: 196B
to support state rebate programs for residential
Federal Amount Available: $300 million, nationally
State Energy Conservation Office (SECO)
Estimated Allocation: $23,341,000
Program Objectives:
Save energy by encouraging appliance
replacement through consumer rebates
Make rebates available to consumers
Enhance existing rebate programs by leveraging
ENERGY STAR national partner relationships
and local program infrastructure
Keep administrative costs low while adhering to
monitoring and evaluation requirements
Promote state and national tracking and
accountability
Use existing ENERGY STAR consumer education
and outreach materials
Program Status:
Initial Applications submitted to the Department of
Energy (DOE) on 8/15/09.
SECO Comprehensive Application submitted to
DOE 10/14/09.
DOE approval announced on 12/11/09.
SECO issued Request for Proposals (RFP) for
Rebate Program Implementation Contractor on
12/28/09. Proposals due by 1/13/10.
Program Details:
Summary: Texas will use approximately $23
million in federal stimulus funds for a mail-in
rebate program for consumers who purchase
certain energy efficient household appliances.
For additional information see our Energy
Efficient Appliance Rebate Program FAQs.
Who Qualifies: The U.S. Department of Energy
approved the rebates for consumers who buy
eligible Energy Star appliances and replace the
same type of old appliance that's functional. The
Texas program will also offer an incentive to
recycle old appliances.
Timing: The mail-in rebates will apply to eligible
appliances purchased between April 16 and April
25, 2010. The 10-day period will coincide with
Earth Day. Offering the program next spring will
give retailers time to stock up on appliances, give
the state time to select a vendor to administer the
rebates, and allow ample time to inform
consumers about details of the rebate program.
NOTE - the rebate program will not be retroactive.
It will only apply to purchases made once the
program officially begins in April 2010.
Rebate Amounts: The rebates will be as follows:
Appliance Rebate With $75 Recycling Rebate
Refrigerator $240 $315
Freezer $180 $255
Room Air Conditioner $45 $120
Clothes Washer $150 or $180* $225 or $255
Dishwasher $110 or $140* $185 or $215
Central Air Conditioner $600 , $800 or $1,000*
$675, $875 or $1,075
Heat Pump $1,200 – $1,600* $1,275 – $1,675
Water Heater $190 – $640* $265 – $715
* Depending on appliance type and energy
efficiency of model purchased
Rebate Process: Consumers will have an
opportunity to reserve an appliance rebate by
calling a toll-free number or registering online
approximately two weeks prior to April 16, 2010.
After the reserved mail-in rebates are awarded,
any remaining funds will be rebated to
consumers on a first-come, first-served basis.
Shoppers will be limited to two appliance rebates
and two recycling rebates per household.
Recycling: Texas plans to include recycling
opportunities of old appliances in the program
design. SECO is also working with retailers and
recycling facilities to create a system to help
consumers replace functional old appliances and
recycle them where available.
Get the latest updates. Sign up for Energy
Efficient Appliance Rebate e-mails.
Related Links:
While consumers are awaiting additional
program details, below are some helpful links.
ENERGY STAR Web site
Federal Tax Credits for Energy Efficiency
Special Offers and Rebates from ENERGY STAR
Partners
Database of State Incentives for Renewables &
Efficiency - Texas Residential Incentives
Legal Authority:
Federal Code: Energy Policy Act of 2005 (PDF, 3.1
MB), Title I, Subtitle B, Section 124 (42 USC
15821)
Request for Proposals (RFP) for Rebate Program
Implementation Contractor:
RFP Title: Energy Efficiency Appliance Rebate
Program for the Stimulus Grant Program
Agency Requisition Number: 196B