Conserving energy through the use of “green” products might not have been at the top of your list a few years ago, but thanks to the 2009 economic stimulus bill the government has made it financially beneficial to homeowners to work toward energy efficiency. Tax credits are available unlike ever before to homeowners who are planning a home remodel with green appliances and practices.
The 2009 economic stimulus bill improves upon pre-existing credits in a big way:
- 2009 tax credits are now in effect until 2010
- The 10% tax credit is now 30%
- Tax credits that were once a specific amount are now converted to 30% of the cost of materials
- The maximum credit is now $1500 instead of $500 and is for all improvements combined for the 2009-2010 period
- Certain home improvements, including geothermal heat pumps, solar water heaters, and panels are not subject to the $1500 maximum
Asheville remodeling contractors such as Brock Builders can perform a home energy audit to outline the areas that will benefit most from installing energy-efficient appliances and insulation systems. By installing a variety of energy-efficient items from the following categories, you may be eligible to claim a tax credit of 30 percent:
- Biomass stoves
- Exterior doors, skylights and windows
- Roofing (metal and asphalt)
- Storm doors and windows
- Water heaters (nonsolar)
Tax credits are also available at 30% of the cost, with no upper limit through 2016 (for existing homes and new construction) for the following categories:
- Fuel cells
- Geothermal heat pumps
- Solar panels
- Solar water heaters
- Small wind energy systems
The new tax credit does have a discrepancy, however, when it comes to windows. Energy Star windows purchased before June 1, 2009 are eligible for the tax credit of 30%, but not all Energy Star windows purchased after June 1 will qualify. To meet the requirements for the tax credit after June 1, the windows in your remodel must be super-efficient windows with a U-factor and solar heat gain coefficient (SHGC) less than or equal to .30. According to Energy Star’s website, most of their windows will not meet the requirements for the tax credit. These confusing standards are being reviewed by the American Architectural Manufacturers Association (AAMA), who are urging Congress to reconcile the stimulus bill standards with Energy Star criteria.
In order to qualify for the tax credit, all products must have a signed statement from the manufacturer certifying the product meets the standards for the tax credit. The Manufacturer Certification Statement isn’t required to send in with your tax return but must accompany your receipts and records. It is recommended by the National Association of Home Builders (NAHB) to save all receipts with the contact information of each manufacturer, the make and model of the product, and the manufacturer’s statement that the product meets the tax credit standards.
Whether you plan to do a basement, bath or kitchen remodel, hiring a general contractor familiar with these tax credits ensures your home remodel is earning the highest credits possible, the proper appliances and products are purchased and installed, and the specific records you need are organized. When helping the environment while saving money, everybody wins.