What The Recent Renewable Energy Legislation Means For Consumers and Entrepreneurs
The following is guest post submitted to me by the ecopreneurs over at Grow and Make - The Sustainable Living Store.
Last Friday congress passed the renewable-energy Incentive Tax Credit, as an attachment to the $700b financial bail-out. This legislation provides an extension of the existing renewable tax credits, but also includes provisions for new tax incentives as well as bonds and the relaxation of regulations for industry and changes for major utilities.
As an entrepreneur and consumer, I was very curious to learn more about the implications and constraints of this legislation.
Aside from the research I did on my own, I discussed the meaning of this legislation with a few good sources of information, one being Bill Gross at IdeaLab, who has investments in renewable energy. Another excellent source of information was Solar Oregon, a non-profit based in Portland providing consumer information and resources on solar energy. I ultimately ended up talking to the Department of Energy and the IRS to nail down specifics.
What became clear from my inquiries and research is the following:
First, the new legislation applies in 2009, although it extends existing 2005 legislation for renewable energy.
Secondly, there has been a removal of the $2000 tax-credit cap which previously limited the amount that was eligible for a tax-payer refund on their investment. Additionally, you can offset AMT taxes with the credit if you have outstanding AMT taxes due. Residential homeowners can recover 30% of their investment costs and a business can recover 50%.
Additionally, the existing wind power credit has been extended for one year and the geothermal and biomass energy credits have been extended for two years. The 2005 solar energy credit has been extended for eight years.
