Additional Residential And Vehicle Clean Energy Credits

Taxpayers who make additional clean energy improvements to their homes may be able to receive the Residential Clean Energy Credit (RCEC). This credit is 30% of the cost of new, qualified clean energy property placed in service between January 1, 2023 and December 31, 2032. The credit is non-refundable, but can be carried forward to future years.

Residential Clean Energy Credit

In order to qualify, the home must be located inside the US, and the improvements must be made to the taxpayers principal residence, whether it is owned or rented. Landlords who do not reside in the home are excluded from this credit.

Qualifying expenses include…

1 – Qualified solar property

2 – Qualified solar water heating property

3 – Qualified fuel cell property (only if installed at a taxpayer’s principal residence)

4 – Qualified small wind energy property expenditures

5 – Qualified geothermal heat pump property

6 – Qualified battery storage technology

Taxpayers who use their homes for business purposes face limitations on the credit.

Clean Energy Credits for New Vehicles

This is split into two credits which include a $3,750 credit for purchasing new vehicles that meet the mineral content requirement. There’s another $3,750 credit for new vehicles with battery components manufactured or assembled inside the US, Canada, or Mexico, provided the vehicle was placed into service after April 17, 2023.

The credit is non-refundable and cannot be carried forward to future years. After January 1, 2024, the purchaser can elect to transfer the credit to the dealer to reduce the purchase price.

Qualifying vehicles must have the following…

1 – A battery capacity of at least seven kilowatt hours

2 – A Gross Vehicle Weight under 14,000 lbs.

3 – Must have final assembly in North America

4 – Must meet the mineral and battery component tests

5 – Taxpayers must have a Modified Adjusted Gross income below $300K on a MFJ Return, below $225K for Head of Household, and under $150K for all other taxpayers.

6 – The MSRP on vans and SUVs must be under $80K. For all other vehicles, it must be below $55K.

Clean Energy Credit For Used Vehicles

In order to qualify, the sale must happen through a dealer who furnishes the sale information to the IRS. Further qualifications include…

1 – A purchase price below $25K

2 – Vehicles must be at least two model years older than the sale date

3 – Vehicles must weigh less than 14,000 lbs.

4 – Vehicles must be eligible for FCV or plug-in EV with fewer than seven kilowatt hours

5 – Vehicles must be used inside the US.

6 – Taxpayers may only claim this credit every three years

Let me leave you with this…

I wrote about the ability for owners of S Corps and other pass-through entities to receive a full deduction on the health insurance costs paid by their companies last week. Interest in this deduction has been brisk.

If you’re paying $20K per year for your health insurance, you’re paying a combined income tax rate of 29%, and your health insurance deduction was either limited or eliminated altogether, then this could save you up to $5,800 per year. One of the nice things about this is that we can amend the last three years of your returns to claim this deduction.

If you’re in a higher income tax bracket or you’re paying more than $20K annually for your health insurance, then your savings would be potentially even more. Our ability to amend the 2020 income tax returns will end in March of 2024, so if you’d like us to do this, please contact us today.

Also, please realize that I cannot do any reasonable tax planning for you or your family in December if your books aren’t up to date, so please get your work into us today.

We’re all going to get through this. Let’s get through it together.

As an inducement, we’re offering 33% off your first six months of bookkeeping and / or the first three months of electronic payroll services on a complimentary basis. In order to claim this benefit, please click on the appropriate button below and provide your contact information. We’d love to help.

Accounting Solutions Ltd. stands ready to complete our mission and purpose of protecting you, your family, and your business. Whether you need Payroll Services, or Accounting and Tax Work, you have but to ask. I’m here and I remain,

Sincerely yours,

Chris Amundson


Accounting Solutions Ltd.



Note that the only professional services provided by Accounting Solutions Ltd. are those specified in a written communication from our office detailing the scope of services to be rendered and the terms and conditions applicable to the engagement.