Did you know part of the US federal government's stimulus package provides tax credits for home owners that make certain improvements to their home? Home improvement tax credits are now available for home owners that increase the energy efficiency of their home, with some conditions that must be followed to be eligible. The home improvement(s) must be "placed in service" from January 1, 2009 through December 31, 2010 and be for the taxpayer's principal residence, except for geothermal heat pumps, solar water heaters, solar panels, and small wind energy systems (where even second homes and rentals qualify).
The maximum total amount that can be claimed is $1,500 for all products placed in service during 2009 and 2010 for most home improvements, again exluding geothermal heat pumps, solar water heaters, solar panels, fuel cells, and small wind energy systems which are not subject to this cap, and are in effect through 2016. Your home improvement must have a Manufacturer Certification Statement to qualify. Save your receipts for all home-improvement related expenditures along with the Manufacturer Certification Statement. All home improvements made in 2009 should be claimed on your 2009 taxes (filed by April 15, 2010) - use IRS Tax Form 5695 (2009 version). These new tax forms will become available in late 2009 or early 2010.
If you are building a new home, you can qualify for the tax credit for geothermal heat pumps, photovoltaics, solar water heaters, small wind energy systems and fuel cells, but not the tax credits for windows, doors, insulation, roofs, HVAC, or non-solar water heaters. More.
Federal Tax Credits for Energy Efficiency includes:
Tax Credits for Consumers
Tax credits are available at 30% of the cost, up to $1,500, in 2009 & 2010 (for existing homes only) for:
- Windows and Doors
- Roofs (Metal and Asphalt)
- Water Heaters (non-solar)
- Biomass Stoves
Tax credits are available at 30% of the cost, with no upper limit through 2016 (for existing homes & new construction) for:
- Geothermal Heat Pumps
- Solar Panels
- Solar Water Heaters
- Small Wind Energy Systems
- Fuel Cells
As always, Credit Unions Online highly recommends that any home owner check with a qualified tax advisor prior to making investments in home improvements so you are not surprised about any possible ineligibility for the stimulus tax credits.