In 2010 Congress promised substantial tax credits for homeowners who make energy-efficient improvements on their home. While these breaks have been somewhat pared back for 2011, there are still numerous ways in which you can save by ensuring your improvements meet with energy efficiency standards.
For 2011 the maximum tax break that can be received for energy-efficient home improvements is $500, reduced from a limit of $1,500 in 2009 and 2010. The law has also placed a limit on the amount you can claim for specific projects.
Despite these cutbacks, it is still important to know what is still available to you. With the remaining tax credits it is still possible to find substantial savings on your tax bill.
Considering Claiming Energy-Efficient Tax Credits? Here's a Few Things You Need to Know
1. Remain aware of the existing maximum credit.
The $500 maximum credit applies to the lifetime of the taxpayer. It is not an annual limit, nor is it applicable to the property itself. Therefore, for those who claimed $500 or more since 2006 (the year the credit became available), it is not possible to claim any further tax breaks for energy-efficient improvements.
2. The tax credit is restricted to primary residences.
The energy-efficiency credit cannot be applied to any property other than your primary residence. This exclusion includes second homes and businesses.
3. Look out for the Energy Star designation.
Generally home improvements such as windows, insulation and heat pumps will qualify for the credit, so long as they have an Energy Star designation. Energy Star is a joint program of the U.S. Environmental Protection Agency and the U.S. Department of Energy. Products with Energy Star designations all have to meet strict energy efficiency guidelines as set out by the EPA and the US Department of Energy.
4. Not all Energy Star products qualify for the federal tax credit.
Many taxpayers assume they will be eligible for the federal tax credit because they have purchased an Energy Star appliance. However, while these products may help reduce your energy bill, they do not always qualify for the energy-efficient tax credit. Ineligible appliances include refrigerators, washer-dryers, ovens, ceiling fans, light fixtures and room air conditioners.
However, while such products may be ineligible for the federal tax credit, they may still qualify for a state rebate. In fact, last year, 36 states offered rebates to residents who purchased Energy Star products.
5. It is still possible to claim credit for improvements made in 2009 and 2010.
Energy-efficient improvements made in 2009 and 2010 can still qualify for the tax credit. If you failed to claim the credit for the year in which the improvement was completed, it is still worth your while: improvements made in those years are still eligible for a maximum lifetime credit of $1,500.
For more information visit: http://leetaxhelp.com
For 2011 the maximum tax break that can be received for energy-efficient home improvements is $500, reduced from a limit of $1,500 in 2009 and 2010. The law has also placed a limit on the amount you can claim for specific projects.
Despite these cutbacks, it is still important to know what is still available to you. With the remaining tax credits it is still possible to find substantial savings on your tax bill.
Considering Claiming Energy-Efficient Tax Credits? Here's a Few Things You Need to Know
1. Remain aware of the existing maximum credit.
The $500 maximum credit applies to the lifetime of the taxpayer. It is not an annual limit, nor is it applicable to the property itself. Therefore, for those who claimed $500 or more since 2006 (the year the credit became available), it is not possible to claim any further tax breaks for energy-efficient improvements.
2. The tax credit is restricted to primary residences.
The energy-efficiency credit cannot be applied to any property other than your primary residence. This exclusion includes second homes and businesses.
3. Look out for the Energy Star designation.
Generally home improvements such as windows, insulation and heat pumps will qualify for the credit, so long as they have an Energy Star designation. Energy Star is a joint program of the U.S. Environmental Protection Agency and the U.S. Department of Energy. Products with Energy Star designations all have to meet strict energy efficiency guidelines as set out by the EPA and the US Department of Energy.
4. Not all Energy Star products qualify for the federal tax credit.
Many taxpayers assume they will be eligible for the federal tax credit because they have purchased an Energy Star appliance. However, while these products may help reduce your energy bill, they do not always qualify for the energy-efficient tax credit. Ineligible appliances include refrigerators, washer-dryers, ovens, ceiling fans, light fixtures and room air conditioners.
However, while such products may be ineligible for the federal tax credit, they may still qualify for a state rebate. In fact, last year, 36 states offered rebates to residents who purchased Energy Star products.
5. It is still possible to claim credit for improvements made in 2009 and 2010.
Energy-efficient improvements made in 2009 and 2010 can still qualify for the tax credit. If you failed to claim the credit for the year in which the improvement was completed, it is still worth your while: improvements made in those years are still eligible for a maximum lifetime credit of $1,500.
For more information visit: http://leetaxhelp.com