[Tax Year 2019] Residential Energy Efficient Property Credit (Part I) - figuring the cost

[mcelwest]

Hi all,

Just wanted your thoughts on figuring the "cost" for form 5695, specifically the treatment of rebates.

So for example:

System Cost = 50,000

System Discount (from provider) = 15,000

Total = 35,000

Then the rebates kick in:

NY State rebate (NYSERDA) = 17,500

ConEdison (gas/elec supplier) rebate = 2,500

Now, my assumption is that the NY State rebate should be treated as part of the "cost", as otherwise you'd be double dipping state and federal?

What about the utility supplier? Should this be included also? I figured yes, otherwise, it would be income, right and get taxed there? Or another alternative?

Thoughts welcomed!

[AlexanderS08 · Accepted solution]

You are correct that the credit provided by the utility supplier will also reduce your "cost" at least for purposes of calculating your eligibility for any Federal Tax Credit.