Things You Can Do at Home to Get Home Energy Tax Credits

Energy tax credits offer an excellent opportunity for DIY individuals and homeowners to save money while reducing their environmental footprint. These incentives, provided by governments, aim to promote energy-efficient improvements in homes and properties. The good news is that you can often tackle many of these projects yourself to maximize your savings. Here are some common examples of energy-efficient upgrades that may qualify for tax credits:

Credit: Kindel Media/Pexels

Solar Panels:

Installing solar panels on your property to generate electricity from sunlight is a common and widely recognized way to qualify for energy tax credits. This can include both solar photovoltaic (PV) systems for electricity generation and solar thermal systems for water heating.

Energy-Efficient Windows and Doors:

Upgrading to energy-efficient windows and doors that meet specific energy performance criteria, such as ENERGY STAR certification, may qualify for tax credits. These improvements help reduce heat loss and gain in your home, leading to lower energy consumption.

Insulation:

Adding insulation to your home to improve its energy efficiency can often be eligible for tax credits, and is one of the more cost-efficient ways of improving your home’s heating and cooling capabilities, all while getting tax credits. Properly insulated homes are better at maintaining consistent indoor temperatures and reducing the need for heating and cooling.

Credit: Airam Dato-on/Pexels

High-Efficiency HVAC Systems:

Replacing or upgrading your heating, ventilation, and air conditioning (HVAC) system with high-efficiency models that meet specific energy efficiency standards may qualify for tax credits. This includes furnaces, air conditioners, heat pumps, and boilers.

Small Wind Turbines:

In some regions, installing small wind turbines on your property to generate electricity can be eligible for tax credits. These turbines harness wind energy and convert it into usable electricity. They can also be found at certain retailers or online.

Credit: ENERGY STAR


Energy-Efficient Appliances:

Purchasing energy-efficient appliances that meet specific criteria may qualify for tax credits. These appliances often have the ENERGY STAR label and consume less energy than standard models.

Energy Audits:

In some cases, the cost of an energy audit to assess your home’s energy efficiency and recommend improvements may also be eligible for tax credits.

The amount of the credit you can take is a percentage of the total improvement expenses in the year of installation:

2022: 30%, up to a lifetime maximum of $500

2023 through 2032: 30%, up to a maximum of $1,200 (heat pumps, biomass stoves and boilers have a separate annual credit limit of $2,000), no lifetime limit.

Conclusion:

Take advantage of these energy tax credits by tackling these DIY projects. Remember that eligibility criteria, maximum credit amounts, and application processes can vary by location and specific tax credit programs. Consult with Georgen Scarborough Associates and keep meticulous records of your energy-efficient improvements and expenses. Stay informed about any changes in tax laws and incentives to ensure you make the most of these opportunities.

For more information on how to outfit your home to receive 2023 – 2032’s Home Energy Tax Credits, contact Georgen Scarborough Associates at (703) 319-3990 or through their website at gsacpa.com.

Source: Energy.gov, IRS.gov

Visit the Energy.gov site for more information:
Making Our Homes More Efficient: Clean Energy Tax Credits for Consumers | Department of Energy

Visit the IRS.gov site for more information:
Home Energy Tax Credits | Internal Revenue Service (irs.gov)

Energy Efficient Home Improvement Credit | Internal Revenue Service (irs.gov)

Frequently asked questions about energy efficient home improvements and residential clean energy property credits — Qualifying Residence | Internal Revenue Service (irs.gov)

 

 

How Contractors Account for General and Administrative Expenses

How Contractors Account for General and Administrative Expenses-min

Government contractors deal with a range of general and administrative expenses or overhead costs. The term ‘overhead costs’ is a broad category. It’s not usually confined to a single project, but allocated and distributed across several projects. There are two types of costs in this regard: general & administrative (G&A) and indirect. How should a contractor go about allocating G&A expenses?

How to allocate G&A costs

You should consult a certified public accountant on your allocation of overhead costs. As these can be quite complex. Some of the matters to consider on how contractors account for general and administrative expenses are:

  • the real costs associated with completing a job
  • what costs can be considered as overhead costs
  • the best method for allocating G&A costs, and
  • the technology that the company uses.

Once answering these questions, you can allocate your costs in question in a number of ways. For example, label them as direct job costs or as direct labor costs (direct labor hours). The types of projects involved and the type of company determine the right method. For example, contractors whose work is less labor-intensive would do well to allocate their costs based on total direct job costs, rather than direct labor hours. In contrast, the pricing for more labor-intensive work depends on labor hours.

How to determine overhead rates

Determine overhead rates by using the chosen method of cost allocation. Calculate your rate as a percentage of revenue or a portion of revenue if your costs are allocated according to job cost. If you focus on labor costs, then calculate your rate as a percentage of those. You can also track actual costs in your general ledger (G/L). Then distribute them proportionally across your jobs.

Allocate your general and administrative expenses in a way that best suits your company, projects, and working methods with a certified public accountant. Contact Georgen Scarborough to make your financials more accurate and manageable.

The PATH Act explained by GSACPA

The path act

According to the IRS, the Protecting Americans from Tax Hikes (PATH) Act was enacted in 2015. This act extends to various aspects that taxpayers should be aware of, including changes to legislation that regulate taxes and extending some laws that would have expired. The act aims to protect taxpayers against fraud. It includes provisions that may affect the taxpayer credits of individuals and businesses. This guide will take a look at those aspects. The path act

What taxpayers need to know about the PATH Act 

The PATH Act extends expired tax laws and introduced new regulations to reduce fraud and to ensure that Americans get the correct refunds from the IRS. The PATH Act now addresses regulations governing Additional Child Tax Credit (ACTC), Earned Income Tax Credit (EITC), and Work Opportunity Tax Credit (WOTC). Although the act may not change the amount of your return or when you receive your refund, it does ensure that certain tax credits are monitored more closely.

The most important aspect to recognize is that the PATH Act will not change how you complete your tax return. Although early filers may experience some delays, these delays afford the IRS opportunities to counteract possible tax fraud.

Key aspects of the PATH Act

Under the Act, some taxpayers who file early for Additional Child Tax Credit (ACTC) or Earned Income Tax Credit (EITC) may receive their refund later. These taxpayers could have to wait until after the 15th of February to receive a refund. The delay allows the IRS to verify information that can help to reduce tax fraud. All pending refunds should be released from the 15th of February, so if you don’t receive your refund within 4-6 weeks after the 15th of February, you may want to visit the IRS website to find out about the delay. 

The Act has retroactively extended the Work Opportunity Tax Credit (WOTC). This is a credit for employers who hire workers from target groups faced with barriers to employment. 

If you’re still unsure about any part of the PATH Act, or if you need more tax tips, visit our website or reach out to talk to a tax expert about your tax refund.