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“Look at history. Everything we have, every great achievement has come from the independent work of some independent mind. Every horror and destruction came from some attempts to force men into a herd of brainless, soulless robots. Without personal rights, without personal ambition, without will, hope, or dignity. It is an ancient conflict. It has another name: the individual against the collective.

Our country, the noblest country in the history of men, was based on the principle of individualism. The principle of man’s inalienable rights. It was a country where a man was free to seek his own happiness, to gain and produce, not to give up and renounce. To prosper, not to starve. To achieve, not to plunder. To hold as his highest virtue, his self-respect. Look at the results. That is what the collectivists are now asking you to destroy….” Ayn Rand, The Fountainhead, Howard Roark speech to the court

This month I will opine on the recent tax legislation that expanded credits for social engineering, namely the energy credits for solar, wind and Electric Vehicles.

The tax credit for residential (and commercial) solar has been increased back to 30% of the cost of purchase and installation. This is not a refundable credit so it will only reduce your income tax to zero in any given year. We have done the projections of the cost recovery of these solar installations and find them to be at least 10 years, if not 20 years, depending on usage and local rates. The additional “fly in the ointment” is that most power companies will not buy your excess capacity, so you can only bring your monthly electric bills to zero. It a nice idea, but with the current technology it won’t pay off in most situations. The typical home solar system with battery backup is approx. $ 50,000 recently for the clients that have done it.

The electric vehicle credit changes would take two pages to SUMMARIZE but the short version is that the $ 7500 credit is restricted to lower income people (under $ 150K for singles) and a price point that eliminates most of the “cooler” EVs. There is also a limited credit for used EVs again limited to incomes under $ 150K for joint filers. Most EVs are actually not eligible for the full credit as of this writing.

Wind energy has been a source of controversy since its invention as more than something to pump water out of a well on a farm. (noise, bird strikes, just plain ugly) I spend a lot of time in West Texas where the wind blows all the time. There are windmills and wind farms everywhere. Many times, they are not spinning. I’m told that when the power grid is “full” they are turned off. We are talking about thousands of windmills costing billions of dollars. Bought with tax credits, mostly.

The tax code has been a source of social engineering at least as long as I have been practicing. This includes the married filing joint filing, the child credits, the mortgage interest deduction, etc. The Internal Revenue Code is over 6900 pages with approximately 3 million words. Anyone who says they understand all of it should have their own reality TV show. We can help navigate this complicated source of revenue for the government, and expense to the rest of us.

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