Green Your Refund: Energy Tax Credits in Texas

by energyproviderstexascomenergyn in Uncategorized

As the deadline approaches for filing tax returns, Texans are searching for options to reduce their tax liability and keep more of their hard-earned money. Did you know that people who have made changes to their homes in the past year to improve efficiency and cut down on energy use may be eligible to apply for tax credits? This brief overview of energy tax credits available in Texas can help households reap the financial benefits of going green.

Renewable Energy Systems Property Tax Exemption

This statewide tax credit allows Texans to reduce the total amount of property tax that they owe if they have recently installed a renewable energy source such as photovoltaic solar paneling. With this exemption, property owners are not required to pay property taxes on the added value of a building when that value is due to installation of a renewable energy source. For example, if a building originally appraised at $150,000 is now worth $160,000 due to the installation of solar panels, the property owner will not have to pay taxes on the additional $10,000 in property value.

Local tax credit programs

While the Renewable Energy Systems Property Tax Exemption is the one statewide tax credit available to property owners, Texans in certain counties or cities may be eligible to apply for local tax credits. Examples of these tax credits can be found below, and the full list for the state is provided by the Database of State Incentives for Renewables & Efficiency.

  • City of Friendswood—Property Tax Abatement for Green Commercial Buildings

    Commercial property owners in Friendswood, TX, are able to reduce their amount of property tax owed each year by as much as 10 percent if they pursue LEED certification.

  • Energy Star Sales Tax Holiday for Energy-Efficient Products

    Texas residents who purchase Energy Star-certified appliances during the last weekend of May are able to receive a sales tax exemption. This exemption applies to big-ticket appliances including washers, refrigerators and even central air conditioning systems, so the savings can be significant. Not only is the 6.25 percent state sales tax removed from the sales price of these appliances, but any additional local sales taxes will not be charged during the three-day sales tax holiday.

Sources:

http://dsireusa.org/incentives/index.cfm?re=0&ee=0&spv=0&st=0&srp=1&state=TX

http://seco.cpa.state.tx.us/re/incentives-taxcode-statutes.php

http://www.texasishot.org/energy-efficiency-rebates/