Before you drop your taxes in the mail this April, be sure that you get credit for all the work you did to make your home more energy efficient. The Residential Energy Efficiency Tax Credit, which first expired at the end of 2011, was renewed under the American Taxpayer Relief Act of 2012, but it expired once again on December 31, 2013. In other words, this may be your last chance to get this particular energy credit.
What does that mean for me?
If you made any qualifying improvements to your primary residence in 2013, you’re eligible for tax credits up to $500.
What equipment qualifies for the Residential Energy Efficiency Tax Credit?
systems designed to reduce a home’s heat loss or gain,
energy efficient exterior doors and windows, including skylights,
roofs designed to reduce heat gain, including both pigmented metal roofs and asphalt roofs with Energy Star-approved cooling granules, and
high efficiency air conditioners and heaters.
(For more detailed information, check out this Energy Star resource.)
What else do I need to know about the Energy Efficiency Tax Credit?
The tax credit is worth 10% of the cost of upgrading the efficiency of a home; however, the cap for all improvements is $500.
If you met the $500 cap in previous years, you are not eligible to take the credit again.
To qualify, improvements must meet the requirements established by the International Energy Conservation Code.
The cost of installation is not included in the Energy Efficiency tax credit.
How do I claim my credit?
Dig up all those receipts and the Manufacturer’s Certification Statements that came with your equipment.
Fill out the 2013 version of IRS Form 5695 and submit it with you taxes by April 15, 2014.
Though this particular credit will no longer be available next year, tax credits are only a small portion of the savings gained by making your home more energy efficient. Most Americans spend at least 6% of their monthly income on utilities; increasing your home’s efficiency through the installation of high quality insulation alone can cut that cost considerably.
Don’t forget your April 15th deadline, and as summer approaches, remember that money lost to the IRS is nothing compared to the money lost to high utility bills. Contact Sunlight Contractors to get a home energy audit to see where you can start saving even more money with energy efficiency.
Next week: What you need to know about the Renewable Energy Tax Credit.
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