Residential energy credit was created to reduce dependence on fossil fuels.
It is intended to help homeowners implement energy saving improvements.
Residential energy credit used to encourage sustainable energy
The residential energy credit was designed to support the installation of roof tiles, solar panels, water heaters, geothermal heat pumps, small wind turbines. These items along with others all qualify under the credit as long as they generate enough energy to support the household. Read more about it here.
Potential tax reduction
If property owners have made improvements or installed eco-technologies that generate some energy for the home, you could get a deduction. If the eco-technology was installed after December 31, 2016 and before January 1, 2020, you’ll be able to deduct 30% of what was invested in it.
If it was installation is after December 31,2019 and before January 1, 2023, it is reduced to 26%.
If you join the project after December 31 of this year and before January 1, 2024, you will be entitled to 22%.
This program is emphasizing the importance of rewarding renewable energy generation.