(WSPA) – Buying an electric car saves on gas, and using energy-efficient appliances saves as well, but soon millions of Americans will be able to take advantage of extra savings while going green.
Billions of dollars in new tax credits and rebates will soon be available, so I looked into how you can save on the new clean energy tax incentives.
From attic insulation to energy-efficient windows and air-tight doors, 2023 will be the first year that families can get up to a $1,200 tax credit for home improvements.
“One of the biggest savings, I think we’ll find that you’ll see, might be in your kitchen. The electric appliances will be covered heavily,” David Hammond, with Laurens Electric Cooperative, said.
Just think, switching out your gas stove with an induction stove, or your clothes dryer with a high-efficiency model could be completely covered.
To get a 100% rebate for an energy star appliance, you cannot earn more than 80% of your state’s median income. In South Carolina that is $72,000 for a family of four.
Even those who make between 80% to 150% of the state’s median income, $135,000 for a family of four in S.C., can get a rebate of up to 50% of the appliance.
That’s something that excites people like Jessica Allen who is buying her first home.
“Definitely with our kitchen appliances changing from a gas stove to an electric stove could really save us money because we currently have a propane tank,” Allen said.
HEAT PUMP CREDIT
The biggest energy guzzlers in your home are, by far, your heating and cooling units. So, there is a big push in the new law for electric heat pumps.
With the new law, homeowners can get a $2,000 dollar credit on their Federal taxes.
Plus, low-income homeowners can get a state rebate of up to $8,000.
The new $7,500 electric car tax credit is aimed at boosting the sale of cars that have a final assembly in North America.
The government is still compiling the list of cars that qualify, so more will be known in 2023.
However, the list does include some hybrids, but only those that are plug-in.
Amit Patel, the General Manager of Spartanburg Chrysler Dodge Jeep Ram, said the credit will only apply to electric sedans under $55,000 and trucks and SUVs under $80,000.
“With certain manufacturers, I think it will prevent some cars from qualifying. With Tesla, I think it will not qualify because of the price on sedans,” Patel said. “With the Jeep franchise, I know that will qualify because the cap is $80,000 on a truck and the Wrangler and Grand Cherokee are considered trucks.”
The list of which electric cars qualify is in flux, but here is the current list.
Taxpayers can only get the credit if they make less than $150,000 single, or $300,000 married filing jointly.
USED ELECTRIC CARS
For previously-owned electric vehicles, income-qualified households will have access to a tax credit of up to $4,000.
The vehicle must be at least two years old and cost $25,000 or less.
The credit is only available to those who earn less than $75,000 single, $150,000 married filing jointly.
VERIFY WITH YOUR TAX PROFESSIONAL
It is best to check with your tax professional before purchasing an electric vehicle, or home appliance, to make sure both you and that product qualify.
Whether it’s a new car, or new home improvements, getting some extra cash on top of reducing monthly fuel and energy bills could be a win-win for your wallet and for the environment.