Tax time can be very stressful. Gathering all of your
documents and receipts, filling out forms, wondering if you remembered
everything, and then holding your breath waiting for your refund, or sweating
it out while you try to figure out how to pay what you owe.
While there are many deductions and credits to be had by
taxpayers, some of the easiest can be found by improving on their biggest
investment – their home. More and more
emphasis is being put on energy conservation, both in commercial and residential
buildings, so the government offers tax incentives to homeowners for “Going
Green”. The following is a list of just a few of the items that can save you
green by going green!
- Certain roofing products (metal or asphalt with pigmented coatings or cooling granules to reduce heat gain)
- Advanced main air circulating fans
- Insulation
- Exterior Doors, windows or skylights
- Water heaters (including solar-powered)
- Heat pumps, central air conditioners or furnaces
- Solar Panels
- Biomass Stoves
Another place to look for savings is in installation of some
of the items listed above. Installation qualifies for coverage for:
- Biomass Stoves
- HVAC
- Non-solar water heaters
But not for:
- Roofs
- Insulation
- Skylights, windows and exterior doors
To take advantage of these credits, you need to fill out Form 5695 (instructions for
filling out the form can be found here). Be aware that the tax credit for nonbusiness energy property
is restricted to improvements to and appliances installed at a primary
residence. Rental home, second home, or vacation home improvements do not
qualify for these credits. Also, make sure to save your receipts and invoices,
in case the IRS requires proof of purchase and installation.
Many of the qualified improvements, such as exterior doors,
roofing, windows and skylights must meet the ENERGY STAR® guidelines. More information on what qualifies for ENERGY
STAR tax credits can be found at the ENERGY STAR®
website. Boilers and Furnaces must meet 95 AFUE to qualify for the energy
tax credit. AFUE stands for Annual Fuel Utilization Efficiency, and is a
representation of the average efficiency of the unit. ENERGY STAR® lists key
product criteria here.
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