itsyournature

Submitted by ktfinklea on Monday, April 13, 2009.

Inevitable. Unavoidable. Tax Day is quickly approaching. So while you're cramming to finish your return at the last minute check out this post from our friends at Simple Steps to find out how you can save money by investing in the planet.

New Energy Efficiency Tax Credits

Now's the time to invest in energy-efficient home improvements and take advantage of new federal tax credits. Tax credits are available for 30 percent of the cost of qualified windows, skylights, doors, insulation, water heaters or solar panels. Tax credits, unlike tax deductions, are as good as a rebate -- they come straight out of Line 46, the taxes you owe.

You may not be able to claim tax credits for energy efficiency improvements to your home on this year's return (unless you installed a geothermal heat pump, solar water heater, small wind energy systems or fuel cells) but this is a good time to consider making improvements in 2009 and 2010. The economic stimulus package restored and expanded tax credits for energy-efficient home improvements made in 2009 and 2010.

Why is the government so interested in your windows and insulation? Heating and cooling account for a whopping 40 percent of U.S. residential energy use. Poorly insulated homes, single-paned windows and old inefficient water heaters and boilers are wasting energy and money. By increasing our homes' energy efficiency we can save money, reduce the emissions that cause global warming and reduce the need for new power plants. Learn more about where you may be wasting energy (and money) in your home. Take the house tour.

Tax credits are available for 30 percent of the cost, up to $1,500, for qualified windows, skylights, doors, insulation, metal and asphalt roofs, HVAC, non-solar water heaters and biomass stoves. The credit is available for existing homes and it must be your primary residence. For windows, doors, insulation and roofs, the credit is only for the cost of materials, not installation.

There's no upper limit for geothermal heat pumps, solar panels, solar water heaters, small wind energy systems and fuel cells through 2016 for existing homes and new construction. And you can include the cost of installation when figuring your 30 percent tax credit for these as well as HVAC and biomass stoves.

In addition to the federal tax credit, you may also be eligible for rebates or other incentives from your state when you make energy-related improvements to your home. For state-by-state details, see http://www.dsireusa.org/

Not all Energy Star labeled products are eligible for the tax credit so choose carefully. Learn more about qualified products and credits on the Energy Star website. Check out IRS form 5695 to learn how to claim residential energy credits. Remember to keep your receipts and the Manufacturer Certification Statement.