Alternative Energy Device Deduction
If you install an alternative energy device in your Idaho residence, you may deduct a portion of the amount acutally paid or accrued (billed but not paid). Qualifying devices include:
- A system using solar radiation, wind or geothermal resource primarily to provide heating or cooling, or produce electrical power, or any combination thereof;
- A fluid-to-air heat pump operating on a fluid reservoir heated by solar radiation or geothermal resource but not an air-to-air heat pump unless it uses geothermal resources as part of the system;
- A natural gas or propane heating unit that replaces a noncertified wood stove;
- An Environmental Protection Agency (EPA) certified wood stove or pellet stove meeting hte most current industry and state standards that replaces a noncertified wood stove.
A noncertified wood stove is a wood stove that does not meet the most current EPA standards. The noncertified wood stove must be taken to a site authorized by the Division of Environmental Quality (DEQ) within 30 days from the date of purchase of the qualifying device. The natural gas or propane heating unit, the EPA-certified wood stove, or pellet stove must be installed in the same tax year that the nonqualifying wood stove is turned in to the DEQ. In the year the device is placed in service, you can deduct 40% of the cost to construct, reconstruct, remodel, install or acquire the device, but not more than $5,000. In the next three years after installation, you can deduct 20% of these costs per year, but not more than $5,000 in any year.
Lines 5a-5d: Complete the line(s) that apply to the year you acquired the device(s). For example, if your device was acquired in 2010, complete line 5d. Enter the type of device and total cost. Multiply the total cost by the appropriate percentage.
Line 5e: Total your deduction on line 5e. Line 5e can't be more than $5,000.