If the time has come for you to upgrade your home to make it more energy efficient, you’re not alone. These days, plenty of homeowners are taking steps to improve their homes in order to reduce their monthly utility costs and make their indoor environments more comfortable.
While implementing energy efficiency upgrades is likely to cost you some money upfront, there’s a good reason to avoid putting off your home improvement plans. Thanks to a recent initiative courtesy of the U.S. government, homeowners who install certain qualified energy-efficient appliances and products can receive a generous credit on their upcoming taxes. Kerry Hollenbeck is the owner of Advantage Diagnostics Energy Services, a home energy auditing company dedicated to helping Delaware, Maryland, and Virginia customers improve their homes for the long haul, and according to him, the 2009-2010 energy tax credit has motivated numerous homeowners to take steps to upgrade their houses.
So what exactly does the tax credit entail? Homeowners who purchase and install qualifying energy-efficient products for their houses can receive a 30% tax credit of up to $1,500 on their upcoming taxes. Items such as water heaters, HVAC systems, windows, and insulation all qualify, provided their specifications meet the standards as set forth by the 2009-2010 energy tax credit guidelines.
Sounds good, right? Well, before you run out and start stocking up on energy-efficient appliances in order to lower your tax burden, remember that in order to qualify, you must purchase eligible items for your primary place of residence. If you happen to rent, then you won’t see a dime as far as energy tax credits go. Additionally, if you’re thinking of purchasing a new constructed home, then you should be aware that the tax credit will not apply to you. Finally, in order to receive the credit, you must retain your paperwork and receipts and file the information accordingly on your 2010 taxes. Contrary to what some may think, the government isn’t going to magically get word of your purchases and instantly mail you a check.
So what happens after 2010? According to Hollenbeck, that’s yet to be determined. While there’s a good chance that the government will extend the current program or implement a new one in its place, there are no such guarantees with respect to upgrades such as replacement windows and doors, water heaters, HVAC systems, and insulation. Therefore, if you’re looking to take advantage of the tax credits currently in effect, then you’d be wise to act quickly.
Of course, if you’re looking to make a more significant investment in your home by installing a solar energy system or geothermal heat pump, you have a bit more time. As long as you install these items before the end of 2016, you can receive a 30% tax credit on all qualifying systems. Better yet, this particular credit comes with no limit, so if you install a solar panel or geothermal heat pump, then you’ll get 30% of the final cost back on your taxes, no matter what that figure ends up being.
Remember, it’s not every day that the government is willing to give out money to reward you for home improvements. So if you’ve been toying with the idea of upgrading your home and making it more energy efficient, now is the time to act.
