What kinds of tax credits are available for renewable energy?
• Residential: The State of North Carolina offers a 35 percent tax credit of up to $1,400 for water heating, $3,500 for active- and passive-solar space heating and $10,500 for photovoltaic, wind and hydroelectric systems. The credit can be taken over five years. However, it cannot exceed 50 percent of the taxpayer’s liability. The federal government offers a 30 percent tax credit for solar equipment, up to $2,000. For example, if you spend $4,000 on a solar hot-water heating system, you are eligible for a tax credit of $1,400 (subject to limits) from the state and a $1,200 tax credit from the federal government. You will have to pay some federal tax on the $1,400 state credit — approximately $350 if you are in the 25 percent tax bracket. Ultimately, this means purchasing a $4,000 solar water heater only costs $1,750 at the end of the day. If you spend $10,000 on a one-kilowatt photovoltaic system, you are eligible for a tax credit of $3,500 (subject to limits) from the state and a $2,0
