Did you know that there are tax credits available for certain “green” home improvements? I’m talking about tax credits, which are better than tax deductions. Tax credits will actually reduce your total tax liability, sort of like getting money back from the IRS.
That’s the good news. Now for the urgent news.
Energy Efficient Home Improvement Tax Credit Deadline
These energy-efficient home improvement tax credits will expire at the end of 2011. In order to qualify for the tax credits you will have to start your project no later than October or November and be sure to be finished with the project this year.
Online Resources for Energy Efficient Home Improvement Tax Credits
What type of improvements qualify for the tax credit? I found 2 links that will help you find the information you need.
Products and projects that qualify for the federal tax credit may be found at:
Rebates and tax credits are also offered by states and these incentives can be searched at:
You’ll find that the maximum federal tax credit is $500. This amount varies based upon the type of energy-efficient upgrade that you make.
Of course, in addition to the benefits of the tax credit you’ll enjoy the savings resulting from the energy improvements as well. Insulation that reduces air leakage by 20% to 30% could result in a savings of $220 per year. A new air conditioner, new ductwork, and water heaters can save significantly as well. New windows in your home could save up to $500 annually.
Beyond these smaller improvements there are additional federal tax breaks available for larger improvements such as geothermal heat pumps, solar energy systems, etc. These tax breaks are available until 2016. You can find more information on the Energy Star Website.
Check the websites above for projects that are eligible. And as always consult with a tax professional before proceeding with expenditures that have tax implications.
PS Thinking of buying or selling a home? Please don’t hesitate to give me a call. Or if you looking for a local mortgage lender to help you refinancing your home for these improvements, I’d be glad to help you find one. We’re always glad to answer any questions!