Renewable Energy Tax Credits Available
Renewable Energy Systems
If you have already installed or plan to install any of the following systems, you are eligible for tax credits.
Geothermal Heat Pumps
- Instead of using outside air, geothermal heat pumps use the ground to provide heat, air conditioning, and oftentimes hot water.
Residential, Small Wind Turbines
- Wind turbines provide electricity by converting kinetic energy from the wind.
Solar Water Heaters
- Solar water heaters use the sun’s thermal energy to heat water. There are many different designs, but each includes a collector and a storage tank.
Solar Panels (Photovoltaic Systems)
- Solar panels consist of solar cells that collect light energy from the sun and convert it to electricity. In most residential cases, solar panels are placed on roofs.
- For information on choosing a solar installer and reputable installers in the Kentucky area, please visit the Kentucky Solar Energy Society.
- The credit for solar electric property and solar water heating property is extended for property placed in service through December 31, 2021, at applicable percentages as described in the statute.
- Fuel cells are a clean way to produce electricity. They are like batteries that never run out of energy as long as you keep adding fuel. Electricity is generated from the chemical energy from the reaction that takes place. When hydrogen is used as the fuel, the only products are electricity, water, and heat.
- For more information about how fuel cells work and the different types, please visit https://www.energy.gov/eere/fuelcells/fuel-cells.
Biomass Fuel Stoves
- These stoves use biomass such as wood, plants, or agricultural crops to heat water or homes.
For more specifics on the tax credit amounts and requirements, please visit:
Form 5695, Residential Energy Credits (PDF)
Publication 17, Your Federal Income Tax – Chapter 38, Other Credits – Under Nonrefundable Credits, see Residential Energy Credit for essential guidance
Instructions for Form 5695, Residential Energy Credits – See Residential Energy Efficient Property Credit for detailed guidance