As part of the American Recovery and Reinvestment Act of 2009, the federal government and many state agencies are currently offering lucrative tax incentives for citizens looking to improve their homes’ energy efficiency. The following is a brief overview of what is included in the plan, those who are eligible for tax breaks, and where to find more information about what’s being done on the state and local level.The federal incentive program is divided into two parts. One division includes renovations on existing homes only; the other covers both new construction and improvements to existing structures. Each arm of the federal program awards credits for different things, but neither places restrictions on individual or family income limits—either upper or lower.
The government will provide a tax credit in 2009 and 2010 that is 30% of the cost of improvements up to $1500 made to existing homes only. Eligible renovations included in the program are energy efficient windows and doors, insulation, metal and asphalt roof replacement, HVAC systems installation, non-solar water heaters, and biomass stoves.
Through 2016 the federal government will also credit 30% of the cost, with no upper limit, on new construction and in existing homes for installation of geothermal heat pumps, solar panels, solar water heaters, small wind energy systems, and fuel cells.While the tax credits will generally cover the cost of materials, the only services that qualify for installation and labor charge reimbursements are HVAC, biomass stoves, water heaters (both solar and non-solar), solar panels, geothermal heat pumps, wind energy systems, and fuel cells. Contractor installation charge reimbursements are not allowed for windows, doors, insulation or roofs.
The federal program has also specified separate tax incentives for home builders and commercial property owners. The aim is to encourage commercial construction to look toward more environmentally conscious and cost effective building solutions.
With all of these federal tax credits, certain restrictions and conditions apply. If you are interested in discussing any of these options with your contractor be sure to do your homework first so you’re not left holding the bag on a construction project or extensive remodel that doesn’t qualify. You can log on to the government’s Energy Star website at http://www.energystar.gov/index.cfm?c=tax_credits.tx_index to research the program thoroughly.
At the individual state level, there is much more variation. Through the American Recovery and Reinvestment Act of 2009, President Obama allotted millions of dollars of economic stimulus funds to state and tribal governments and directed them to somehow put the money to use. The money is supposed to encourage states to implement more energy efficient incentives, programs and services for residents. Most states have now set up ARRA websites specifically devoted to explaining the Recovery Act and outlining how the states have chosen to use the stimulus money. Check your state’s homepage for links to state-specific ARRA information and to learn about ways in which your home state is putting that federal money to use for you and your neighbors.
Meanwhile -- 2009 is quickly drawing to a close. Time is running out if you want to make energy-efficient improvements and receive credit on your 2009 tax forms. Fortunately, Horizon Services offers a wide array of energy-efficient heating and cooling systems and equipment that meet and exceed the federal governments energy-efficiency standards. When you schedule a FREE In-Home Energy Analysis, a Horizon comfort consultant will thoroughly analyze your home and your family's heating and cooling needs to match you with the ideal heating and cooling system for your home and budget requirements.
