Wouldn't it be wonderful if you could get a tax break for living a greener life?
As yet, there's no tax credit for composting, buying organic chicken or using CFL lightbulbs. (Darn, those things are expensive!). But some eco-friendly upgrades can yield big rebates on your 2009 return.
Remember, a tax credit is a sweet deal:
It reduces your tax bill, dollar for dollar (i.e. a $2,000 credit knocks down the amount you owe by... $2,000).
- If you made energy-efficient home improvements last year (windows, doors, roofs, water heaters, wood or pellet stoves heating/cooling systems, etc.) you can save up to $1,500.
- If you installed an alternative energy source in your home (wind, solar, etc.), you may qualify for a much bigger tax break: 30% of the cost, with no limit on the amount of the credit.
- If you bought a hybrid vehicle, you may qualify for a tax credit up to $7,500. And that's in addition to the vehicle sales tax deduction.
IRS Warning: Of course, you need to double-check that the products you bought qualify under IRS rules.
Read my piece in yesterday's New York Times: Don’t Overlook the Rewards for Thinking Green.