The New Solar Tax Credit Era!!!
Assume the homeowner adds the option of a $4,300.00 solar hot water system to a new home. A conventional hot water tank would cost between $300.00 or $600.00 per installation for new construction. This means that a minimum of $4,000.00 is the upgrade option for solar water heating systems with an 80-gallon solar tank with an electric element for cloudy days. The federal tax rebate or credit off taxes owed is 30% of the $4,300.00 solar option or $1,290.00. Assume a 3% down payment of $120.00 and interest rate of 6% over a thirty-year period. The spreadsheet below in the 35% income tax bracket for the itemized deduction, the utility savings are based on current natural gas prices for 4 people, or electricity or LP gas for 3 people with a 2% increase per year. Below is the first five-year spreadsheet of a thirty year mortgage.
|
|
|
$1,290 |
Federal Tax Rebate |
+ 385 |
Utility Savings |
+ 80 |
Tax Deduction on loan |
- 120 |
Down payment on Loan |
- 279 |
Yearly Loan Payment |
$1,354 |
Net Profit |
+ 450 |
GRU Rebate - NOTE: The $450.00 rebate is available to builders |
$1,704 |
Net Profit |
| |
|
|
$385.00 |
$1,290.00 |
$81.02 |
$120.00 |
$279.12 |
$1356.90 |
$393.00 |
$0.00 |
$80.00 |
$00.00 |
$279.12 |
$193.88 |
$400.00 |
$0.00 |
$78.91 |
$00.00 |
$279.12 |
$199.79 |
$408.00 |
$0.00 |
$77.75 |
$00.00 |
$279.12 |
$206.63 |
$416.00 |
$0.00 |
$76.53 |
$00.00 |
$279.12 |
$213.41 |
$2002.00 |
$1290.00 |
$394.21 |
$120.00 |
$1395.60 |
$2,170.61 |
|
|
Keep in mind that the first year cash flow of $1,356.00 to someone in the 35% tax bracket is worth $2,078.00 in earned income. This may be a bit confusing but for someone that does not have this $1,356.00 savings would have to earn $ 2,078.00 and pay Uncle Sam $722.00 in taxes to have $1,356.00 in disposable income. The home equity value to a solar hot water system as of 2005 typically increases the resale value of the home by $4,000.00. All ECS Solar Energy Systems components are 100% warranted for a period of five years.
www.ECS-Solar.com
(352) 377-8866
6120 S.W. 13th Street
Gainesville , Fl. 32608 |
|
