How to Maximize Propane Tax Incentives

As the year-end expiration date approaches, PERC's updated online course outlines existing programs and examines best-case scenarios.

Remember those federal tax credits related to residential energy efficiency that Congress extended last year? With the year-end expiration date (not to mention heating season) approaching, now is the time to brush up on how propane building systems can qualify builders and contractors, and their homeowners, for these and other incentives.

By taking "Designing and Retrofitting with Propane Gas: Energy Benefits and Available Incentives," an online training course now available on the Propane Training Academy, construction professionals will be able to review the current federal, state, and local incentives and tax credits that pertain to propane systems and appliances, for new construction as well as remodeling projects. The course also demonstrates how combining credits and rebates can significantly lower up-front hard costs.

Pertinent federal, state, and local program information includes the following examples:

  • Personal Tax Credit for Homeowners. A federal incentive for installing energy-efficient space- and water-heating equipment in the taxpayer's personal residence. The maximum credit is $500; program expires Dec. 31, 2011.
  • Federal, State, and Propane Association Credits. An example shows how a homeowner in Michigan who replaces an electric water heater with a propane tankless water heater—installed cost, $1,800—is eligible for a $300 federal credit if installed before the end of 2011, and a state tax credit of $150. Throw in the $500 rebate from the Michigan Propane Gas Association and the first cost comes down to $850, a savings of $950.
  • Homebuilder Tax Credit. Available for homes that reduce heating and cooling energy consumption by 50 percent relative to the International Energy Code. This now applies retroactively to qualifying homes acquired after Dec. 31, 2009, and before Jan. 1, 2012. The credit amount is $2,000 for site-built homes and $2,000 or $1,000 for manufactured homes, depending on their level of energy efficiency. Expires Dec. 31, 2011.

If you'd like a supplement to the online course, download the fact sheet, "Tax Incentives and Rebates for Energy Efficient Propane Building Systems" (PDF).

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