The 2010 energy tax credit expires on December 31st, 2010. Homeowners looking to complete energy upgrades in their home should act soon to take advantage of this energy tax credit.
Also known as the energy star credit* because of its close ties to the energy star program, the 2010 energy tax credit allows homeowners to receive a tax credit of 30% on certain home energy efficiency upgrades. The maximum tax credit is $1,500. It’s also important to note that the 2010 energy tax credit applies only to existing homes and the home must be a primary residence.
There are numerous types of improvements included in the 2010 energy tax credit, specifically:
Biomass Stoves – Do you want to install a wood-burning stove or have a desire to heat your home by burning moss? You’re in luck. The tax credit applies to the purchase and installation of any biomass stove with an efficiency of 75% or higher. A biomass stove is any stove which uses biological material – typically plant-based sources – to create heat. Some examples of eligible biomass sources are wood, wood pellets, grasses, and algae.
Heating, Ventilation, and Air Conditioning (HVAC) – If your heating or air conditioning systems are old or inefficient, now may be the time to upgrade them. The 2010 energy tax credit applies to the purchase of energy efficient models of air conditioners, heat pumps, boilers, furnaces, and HVAC system circulating fans.
Insulation – Adding insulation to a home is one of the best ways to reduce energy bills, so it is no wonder the 2010 energy tax credit includes insulation. Most common types of insulation are eligible for the tax credit, including batts, rolls, rigid board, blow-in insulation, and air-sealing caulk. Make sure the material you use includes a manufacturer’s certification; you’ll need it when you apply for the credit. Installation costs are not included in the tax credit, so if you’re looking to save money you may want to consider installing the material yourself.
Roof Improvements – Certain types of roof upgrades and roof materials are eligible for the tax credit. Specifically, the tax credit applies to roof-types that reflect most of the sun’s heat away from the home. The EPA certifies some roofing types and materials as being energy star-rated, but this area of energy efficiency can be quite tricky, so be sure to contact a qualified roofing contractor and ask them what type of roof is the best for your situation.
Water Heater Upgrades – Water heaters tend to be a big culprit when it comes to energy waste. Upgrading to a more efficient model can help you save big bucks on your energy bills. The energy tax credit applies to electric and gas models that are at least 90% efficient.
Window and Door Improvements – Most energy efficient windows and doors are eligible for the tax credit, so long as they have a thermal conductance value of 0.30 or less. The same goes for skylights, storm windows, and storm doors.
How to Apply
To claim the 2010 energy tax credit, it’s important that you keep receipts and manufacturer’s certification statements for any eligible upgrades completed in your home. When it comes time to file your 2010 taxes, fill out IRS form 5695 and submit it with your tax return.
For additional information on the 2010 energy tax credit, or other energy tax credits currently available, read the article “Energy Tax Credits”.
*It’s important to note that not all energy star products or home upgrades are eligible for the 2010 energy tax credit.