While you were busy with the holidays and worrying about the weather, there was some good news about saving money on your taxes. Hidden in a huge federal appropriation is an extension of residential energy tax credits for certain home improvements made in 2014. So if you replaced your windows, added insulation, or sealed leaky ducts, you may be eligible for a federal tax credit. Here are the details.
Windows, doors and skylights
If you replaced any windows, doors or skylights or installed new ones that meet Energy Star standards, you are eligible for a tax credit. You don’t have to replace all your windows and doors to qualify and you can claim the credit if you installed a window or door where there wasn’t one before.
Tax credit: 10 percent of the cost, up to $500, but windows are capped at $200. Does not include installation.
Roofs (metal and asphalt)
Roofing materials that meet Energy Star requirements reflect more of the sun’s rays and can lower roof surface temperature by up to 100 degrees F. Qualifying roofing materials include metal roofs with appropriate pigmented coatings and asphalt roofs with appropriate cooling granules.
Tax credit: 10 percent of the cost, not including installation, up to $500.
Non-solar water heaters
Water heating can account for up to 25 percent of the energy used in your home. Qualifying water heaters include gas, oil or propane units with an Energy Factor (overall efficiency) of 0.82 or more or a thermal efficiency of at least 90 percent. Electric heat pump water heaters with an energy factor of 2.0 or more also qualify.
Tax credit: $300
Typical bulk insulation products can qualify for a tax credit, such as batts, rolls, blow-in fibers, rigid boards, expanding spray, and pour-in-place, according to Energy Star. Products that air seal (reduce air leaks) can also qualify, as long as they come with a Manufacturer’s Certification Statement, including weather stripping, spray foam in a can, caulk and house wrap.
Tax credit: 10 percent of the cost, up to $500. Does not include installation but you can install the insulation/home sealing yourself and get the credit.
To heat a home or water, biomass stoves burn wood and wood waste and residues (including wood pellets), agricultural crops and trees, plants (including aquatic plants), grasses, residues and fibers. To qualify, stoves must have a thermal efficiency rating of at least 75 percent.
Tax credit: $300
Heating, ventilation, and air conditioning
Some heating, ventilation and air conditioning equipment qualifies for an energy tax credit. For full details see the Energy Star website. Here are the improvements.
- Central air conditioning, $300 tax credit.
- Advanced main air circulating fan, $50 tax credit.
- Air source heat pumps, $300 tax credit.
- Gas, propane or oil hot water boiler. $150 tax credit, including installation costs.
- Natural gas, propane or oil furnace, $150 tax credit.
How to claim your tax credit
You’ll need to file IRS form 5695 with your 2014 taxes. Be sure to keep a copy of the Manufacturer’s Certification Statement and any receipts or itemized bills. Tax credits for such renewable energy sources as wind, solar and geothermal will be available until the end of 2016. Check Energy Star for more information.