The American Recovery and Reinvestment Act (ARRA) of 2009
Hopefully by now, all of you know about the ARRA tax credits and have or will take advantage of them. In the event it’s only now coming up on your radar screen, the two tax provisions related to energy efficiency in the home are:
1. Homeowners Energy Credit Increased and Extended to 2010
Homeowners will be able to take a nonrefundable credit (i.e. you must have a tax liability that the credit can reduce) of up to $1,500 for making qualified energy saving improvements to their homes. The credit is equal to 30% of the cost, including installation, of these improvements up to the $1,500 maximum. Qualified improvements include energy efficient building property (electric heat pumps, central air conditioners and water heaters), oil furnaces and hot water boilers, and exterior windows, doors, certain roofing materials, and skylights.
2. Residential Energy Efficient Property Credit Cap Eliminated
Beginning in 2009 the limits on qualified: solar water heating property, small wind energy property, and geothermal heat pump property have been eliminated. An individual is allowed a 30% credit for the purchase of residential energy efficient property, such as those listed above as well as qualified solar energy property and qualified fuel cell property, up to a maximum credit of $500 for each 0.5 kilowatt of capacity.
If you have or will purchase any of the appliances or products mentioned above, be certain to claim that on your next taxes. If you have questions about whether it’s worthy of a tax credit, ask the manufacturer or vendor to verify. Even if you’ve made a purchase not listed that you would consider ‘energy-efficient’, that’s worth asking about.
Posted on October 04, 2009