For homeowners who have been postponing improvements to their home involving energy-related projects, the bad news is that many of the Federal Energy Tax Credits are set to expire for projects that were not completed by December 31, 2010. The good news is that the same credits have been extended through 2011, albeit it at a lower rate. Credits for some major renewable energy projects have been extended through 2016. So, if your improvement plans include purchasing energy-efficient equipment, or installing renewable energy systems, don’t put it off too much longer.
Give Yourself Credit Now
Qualifying improvements include:
- biomass stoves
- exterior doors and window replacements,
- storm window installation
- metal or asphalt roofs
- new or replaced insulation
- heating, ventilating, air conditioning (HVAC)
- non-solar water heaters
Energy Tax Credit Extension
Be sure to check with your utility company, local home improvement store or your state’s energy conservation agency for additional ways to earn energy credits. Each state has its own program for allocating its portion of the Federal government’s subsidy which may include rebates on the purchases of standard appliances such as refrigerators, dishwashers and freezers. Many of the rebates are given at the time of purchase.
Big Projects, Big Credits
- Solar energy systems
- Small wind turbines
- Solar-powered water heaters
- Geothermal heat pumps
- Fuel cells
Again, credits are only available for installations occurring on your main residence. For home sale purposes, your credits will reduce the cost basis of your home dollar-for-dollar.
Your energy tax credits are claimed by filing IRS Form 5695 with your Form 1040.