Beware: Clean Energy Tax Credit Scams

There has been an increase in scams targeting clean energy tax credits. Scammers exploit individuals and businesses seeking to benefit from these credits, often using misleading information, false promises, or fraudulent schemes. Below are two common types of scams related to clean energy tax credits and how to protect against them:

1. Fake Solar Energy Installation Offers

Scam: Fake companies pose as legitimate solar panel providers, offering to install solar panels at reduced or no cost by claiming that the customer will receive substantial clean energy tax credits or rebates. The scammers may request an upfront payment for installation, but either never install the panels or install substandard systems that don't qualify for the advertised tax benefits.

Warning Signs: High-pressure sales tactics, unsolicited offers, and vague information about the tax credit process.

Protection: Verify the legitimacy of the solar company by checking reviews, business licenses, and certifications. Additionally, consult with a tax professional to understand the real tax benefits available for solar energy installation.

2. Fake Tax Credit Consultants

Scam: Fraudulent consultants or companies claim they can help individuals or businesses apply for clean energy tax credits. They charge high fees for assistance or file fraudulent tax credit claims that could lead to penalties.

Warning Signs: Requests for payment before services are rendered, guarantees of large tax refunds, or claims that sound too good to be true.

Protection: Use only qualified tax professionals, such as certified public accountants (CPAs) or tax attorneys, to handle tax credit applications. Verify their credentials through professional organizations or government agencies.

How to Avoid Falling Victim to Clean Energy Tax Credit Scams:

1. Always verify the legitimacy of any company, consultant, or individual offering to help you with tax credits or clean energy projects.

2. Consult official government websites (e.g., IRS.gov) for accurate information about available clean energy tax credits and incentives.

3. Work with a licensed tax professional or financial advisor who can help you navigate the complex rules around clean energy tax credits and ensure compliance with IRS regulations.

4. If you suspect a scam, report it to the Federal Trade Commission (FTC), the IRS, or your state's consumer protection agency.

Being aware of these scams and practicing due diligence can help protect against fraudulent schemes that exploit clean energy tax credits.