Making Sense Of The 2009 Tax Credits

Are you as confused as we are about this new tax credit? The economic stimulus package signed into law in February revived and expanded tax credits for energy-efficient home improvements that expired in 2007. We know that doing a home renovation in 2009, that improves your home’s energy-efficiency, is going to pay off more this year than in previous years. But just how much more? What is eligible for the tax credit? Here’s a little breakdown:

  • Energy efficiency tax credits have been raised from 10% of cost to 30%
  • The maximum tax credit has been raised from $500 to $1500 on individual efficiency upgrades
  • More expensive upgrades, such as solar panels, solar water heaters, and geothermal pumps are not limited to their previous $1,500 maximum
  • The $200 tax credit cap on efficient windows has been removed (however, the standards are also more stringent!)

From what we can figure, all this means that it is a good time to upgrade, insulate and/or weatherize your home. You may consider adding AK’s Home Maintenance Services to keep up with the upgrades; and we’ll also try to help you keep up with ever changing tax laws regarding them!


SUMMARY OF TAX CREDITS FOR HOMEOWNERS

Product Category

Product Type

Tax Credit Specification

Tax Credit

Notes

Windows & DoorsExterior Windows and SkylightsU factor <= 0.30

SHGC <= 0.30

30% of cost, up to $1,5002Not allENERGY STAR labeled windows and skylightsqualify for tax credit.

More information

Storm WindowsMeets IECC1in combination with the exterior window over which it is installed, for the applicable climate zone30% of cost, up to $1,5002Manufacturer Certification Statement3will list classes of exterior window (single pane, clear glass, double pane, low-E coating, etc.)4 that a product may be combined with to be eligible in specific climate zones.
Exterior DoorsU factor <= 0.30

SHGC <= 0.30

30% of cost, up to $1,5002Not allENERGY STAR doors will qualify.

More information

Storm DoorsIn combination with a wood door assigned a default U-factor by the IECC1, and does not exceed the default U-factor requirement assigned to such combination by the IECC30% of cost, up to $1,5002
RoofingMetal Roofs,
Asphalt Roofs
ENERGY STAR qualified30% of cost, up to $1,5002All ENERGY STAR metal and asphalt roofs qualify for the tax credit.

Must be expected to last 5 years OR have a 2 year warranty.

InsulationInsulationMeets 2009 IECC & Amendments30% of cost, up to $1,5002For insulation to qualify, its primary purpose must be to insulate. (example: vapor retarders are covered, insulated siding does not qualify).

Must be expected to last 5 years OR have a 2 year warranty

HVACCentral A/CSplit Systems:
EER >=13
SEER >= 16

Package systems:
EER >= 12
SEER >= 14

30% of cost, up to $1,5002For a list of qualified products, go to theConsortium for Energy Efficiency product directory , click on Air Conditioners, then in the “CEE Tier” enter “Residential Advanced Tier 3” for CAC Split Systems, and “Residential Tier 2″ for CAC Package Systems and ASHPs.

Note — not all ENERGY STAR products will qualify for the tax credit. View ENERGY STAR criteria.

Air Source Heat PumpsSplit Systems:
HSPF >= 8.5
EER >= 12.5
SEER >= 15

Package systems:
HSPF >= 8
EER >= 12
SEER >= 14

30% of cost, up to $1,5002
Natural Gas or Propane FurnaceAFUE >= 9530% of cost, up to $1,5002For a list of qualifying products go to the Gas Appliance Manufacturing Association

Not all ENERGY STAR products will qualify for the tax credit. View ENERGY STAR criteria.

Oil FurnaceAFUE >= 9030% of cost, up to $1,5002
Gas, Propane, or Oil Hot Water BoilerAFUE >= 9030% of cost, up to $1,5002
Advanced Main Air Circulating FanNo more than 2% of furnace total energy use30% of cost, up to $1,5002
Water HeatersGas, Oil, Propane Water HeaterEnergy Factor >= 0.82
or a thermal efficiency of at least 90%.
30% of cost, up to $1,5002Not all ENERGY STAR gas storage and gas condensing water heaters will qualify for the tax credit. All ENERGY STAR gas tankless models will qualify.

All ENERGY STAR gas tankless water heaterswill qualify.

View ENERGY STAR criteria.

For a partial list of qualifying products go to the Air Conditioning, Heating, and refrigeration Institute (AHRI)

Electric Heat Pump Water HeaterSame criteria as ENERGY STAR: Energy Factor >= 2.030% of cost, up to $1,5002All ENERGY STAR electric heat pump water heatersqualify for the tax credit.

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