Residential Solar Power

Residential solar power is generated by transforming sun rays into electricity

. This can be done either by directly converting sunlight into energy using photovoltaic (PV), or in a roundabout way with concentrating solar power (CSP).

Inside the latter process sun's energy is employed to boil water and then accustomed to supply power, and various technologies including Sterling engine meals in which a Sterling cycle engine is used to power a generator.

Based on the Energy Policy Act of 2005, passed through the US congress, tax payers who invest in residential solar photovoltaic (PV) systems will receive tax benefits.

Therefore, the solar PV tax credit is applicable to the money spent on buying and installing a solar PV system for that generation of electrical energy for use in U.S homes. 30% of the eligible expenditure is the tax credit, that is directly credited to the tax liability and not deducted from your taxable income. Also the congress passed the American Recovery and Reinvestment Act (ARRA), also known as the stimulus package.

For a home-owner in Sacramento, Calif., the area and government savings can equal to almost half the buying price of a solar power system. The federal Residential Renewable Energy Tax Credit is prolonged to Dec. 31, 2016 so they cover 30 percent on the amount spent for installing of small wind turbines for residences, qualifying geothermal power heat pumps and solar installations (solar water heaters and solar panels). Installation may be established on current home as well as new construction and basic principle residences and second homes.

For micro turbine devices and residential fuel cells installed on principle homes, a tax credit of 30% of the expenditure incurred or more to $500 per.5 kW of power capacity is provided. In the state Arizona, tax payers who offer energy efficient single-family residences are allowed to take a tax deduction of 5 % of the sales price of up to $5,000.

Similarly the state New York provides a 25 % tax credit on solar technology systems having a ceiling of $5,000 along with a 20 percent fuel cell tax credit with an upper limit of $1,500. These could be carried forward for 5 years.

The state of Minnesota went for an extent of providing 100 percent exemption for solar space heat, solar water heat, wind systems and photovoltaic.

The worth added to a house by a solar or wind energy product is exempted from property taxes in the state Wisconsin. Home-owners, that are eligible rebates, aren't prone to report it as income but can deduct its amount from their tax basis.

The initial investment on solar energy systems could be recovered inside a short or a long time. Factors including the type of solar system, climate, usage and installation are taken into account for reaching a conclusion.

There's never been a much better time for you to go solar. With all the available tax credits it is now possible to have your residential solar power system purchase itself through electricity savings in 5-6 years rather than the 25 years it would take with no tax savings.

by: Nancy Hardy

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