April 1, 2010 12:00 am

Energy Star Appliance Rebates Aren

There is a program under way that encourages consumers to replace their old appliances with energy-efficient ones. Like the cash-for-clunkers program that supported new car purchases in 2009, the appliance rebate program does the same thing for certain consumer appliances. The IRS has ruled that the rebates aren’t income to consumers; they are viewed as a reduction in the purchase price. Sellers don’t have to report the rebates to consumers on Forms 1099.

Background

In 2005, Congress established the state energy efficient appliance rebate program as part of the Energy Policy Act. The program provides incentives for residential consumers who purchase certain energy-efficient appliances. The federal government has allocated funds to the states to give rebates for purchasing Energy Star appliances.

State Programs

Each state has its own rebate program. Appliances covered under the program may include such items as refrigerators, freezers, dishwashers, clothes washers, and room air conditioners. Rebates vary greatly, from a $500 rebate for refrigerators purchased by rural Alaskans with disabilities, to a $50 rebate for refrigerators purchased by Connecticut consumers.

Each state program has its own starting and ending date. A few states have already closed their programs. Find information about a rebate program in your state from the Department of Energy at www.energysavers.gov/financial/70022.html.

Source: UILC: 61.00-00, 6041.00-00, March 22, 2010

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Modified ACRS (MACRS)

Depreciation methods applied to assets placed in service after 1986.

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