Stay informed on the latest tax news and developments, including legislation and rule changes, for effective tax planning and compliance.
Home energy credits may be available to taxpayers who install solar panels or make other home upgrades
Tax credits for energy-efficient house upgrades are available to homeowners. Watch out for false company claims. There are two credits: the Residential Clean Energy Credit and the Energy Efficient Home Improvement Credit. The former is applicable to existing homes that have been improved, but not to newly built homes, and it includes things like windows, heaters, and energy audits. Credits have lifetime/annual restrictions and vary annually. The latter covers both new and existing residences, offers percentages without lifetime or annual restrictions, and includes sustainable energy systems. With your tax return, submit Form 5695 to make a claim.
IRS updates coming soon for owners of small business
During National Small Business Week, April 30-May 6, the IRS announced upcoming service improvements for small business taxpayers, made possible by the Inflation Reduction Act (2022). Enhancements include expanded online tools, enabling businesses to view tax information, track refunds, schedule payments, and access tax transcripts online. An online portal has also been launched for businesses to electronically file Form 1099, with future features allowing online responses to certain notices. By 2024, businesses can respond to multiple notices online. Forms 940, 941, and 944 will be simplified and made mobile-friendly. These improvements aim to provide convenient, responsive IRS services for small businesses.
IRS: Choosing to live sustainably could enable taxpayers to get greater home energy tax credits
The IRS informs taxpayers that energy efficient home updates can qualify them for tax credits under the Inflation Reduction Act of 2022. Two credits are available: the Energy Efficient Home Improvement Credit and the Residential Clean Energy Credit. Homeowners and renters can claim these for the year of qualifying expenditures. The former offers up to $3,200 for energy-efficient improvements made after Jan. 1, 2023, such as new doors, insulation, and energy-efficient appliances. The latter allows claims for clean energy property costs, including solar panels and wind turbines, with no annual limit until 2033. These credits are nonrefundable, with the clean energy credit carryforward possible. More details are available on IRS.gov/HomeEnergy.
