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Think globally, deduct locally

Tax credits for sale at Amazon

I just clicked on an Amazon ad that showed up here on the ol' tax blog. No, no click fraud here. The thing simply caught my eye.

The intriguing pitch: QUALIFIES FOR 30% Federal Tax Credit... Best $1,808.00!

Amazon_ad_logo_1 OK, I bit. I had to see who was using taxes as a selling point. Turns out an Amazon Storefront seller is trying to move a solar panel that he says qualifies for the new energy efficient home improvements tax credits (previously blogged about here).

A caveat from the seller: It's good only for areas that get light freezes. He also notes that sales tax is charged only on orders sent to California buyers.

The implication: It's up to you to deal with your state and any use tax assessments it might have. And I know that you all pay applicable use taxes on items you buy elsewhere but use in your home state. Here are some samples of use taxes courtesy the Sales Tax Institute.

A caveat from me: I'm not recommending this product, but I do suggest that you look into the new home improvement tax credit.

If you install a solar water heating system, you'll be able to get a credit of up to $2,000 on your 2006 return for what you put in by Dec. 31. And if you upgrade next year with a photovoltaic system to heat your home like the Amazon seller is offering, that improvement will get you a $2,000 tax break on your 2007 return, too.


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