For those of you looking to make your homes more energy efficient, the 2009 Stimulus Act may provide a way for the IRS to foot some of the bill. Personal tax credits applicable to energy saving improvements or alternative energy improvements on a taxpayer’s principal residence have been increased during this year.
The first personal credit has to do with residential energy property improvements and has been increased from 10% to 30% of the qualified costs. The new aggregate cap for all qualifying costs is $1500, regardless of whether or not you have claimed a similar credit in the past. A few examples of qualified costs include energy saving insulation systems; exterior windows, skylights and doors; metal roofs painted with Energy Star required paint; advanced air circulating fans (leads to increased energy efficiency in furnaces); stoves used to heat the home or water that uses renewable plant-derived fuel; and furnaces or hot water heaters that use qualifying natural gas, propane or oil.
The second credit deals with alternative energy improvements. This is also redeemable for 30% of qualifying costs. Unlike the first credit however, there is no dollar value cap on how much you can receive. The installation of solar panels used for the home or water heating; geothermal heat pumps; small wind energy investments; and fuel cell power plants meeting certain specifications are all examples of qualifying improvements.
For more information regarding what qualifies for the credit, please visit http://www.energystar.gov/index.cfm?c=products.pr_tax_credits. Remember to always keep your receipts when investing in these energy saving improvements to your home. If you choose to participate, you’ll be helping our environment – and your checkbook – both at the same time!
If you have any questions or would like more information, please contact:
Diane Burke, CPA
302-656-6632
DBurke@CoverRossiter.com