In your quest to adopt cleaner, more efficient technologies, you may have recently invested in an electric car or made energy efficiency improvements to your home. But did you know that these investments could translate into significant savings on your taxes? Read on for information on how to maximize your energy credits!
1. Electric Vehicle Credits
If you purchased an electric vehicle in 2023, you may be eligible for new electric vehicle tax credits from the IRS. These credits can be an excellent incentive for those who decide to make the leap to electric mobility.
To claim this credit, you will need your vehicle’s VIN and you will need to fill out Form 8936, which is the “Electric Drive Motor Vehicle and Mixed-Use Electric Vehicle Credit”. This form must be filed with your tax return.
2. Energy Efficiency Improvement Credits
For those who have opted for energy efficiency-oriented home improvement projects, credit availability is also available. This eco-friendly approach not only benefits the planet, but also your pocketbook!
To claim this tax benefit, you must file Form 5695, Part II, “Credits for Residential Energy Improvements” with your tax return. This form will allow you to itemize the improvements made and calculate the credit to which you are entitled.
It is important to note that there are limitations and eligibility criteria for these credits, so we recommend that you carefully review the instructions associated with each form and consult a qualified tax preparer or accountant if you have any questions.