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Making some Green Improvements can Save You Green with Home Energy Credits
in 2009!
Home Energy Credits are INCREASING For 2009!
What are "the" home energy credits and what can they do for me?If you make energy efficient improvements to your home this year or next by using renewable energies, such as the SUN or the WIND......or by making your home more efficient by replacing old doors, windows, upgrade heating system etc., you can qualify for Home Energy Credits from the IRS on your 2009 and 2010 taxes. Of course, there is certain criteria to follow, which is discussed in this section. The IRS and the U.S. Treasury Department are increasing the reward to homeowners who make their homes greener. This Home Energy Credit means more money in homeowner's pockets. How?....
American Recovery and Reinvestment Act of 2009
On February 17, 2009, President Obama signed the American Recovery and Reinvestment Act of 2009, extending the existing Credits we already had available from previous administrations, into the year 2010. The credit amount is increased for Alternative-Energy Equipment placed in service on in connection with your house. Examples of this may be a small wind turbine, solar water heater and geothermal heat pump. The credit on these big items is 30% as with the previous years,however, there is no limit. Say you spend $10,000 on a solar power water heater. Your credit will be $3,000 (30% X $10,000 = $3,000). Homeowners can take advantage of these increased tax credits by having "the government" pay down the amount of taxes we owe in 2009 (and/or 2010)...just for making a GREEN choice!
The Residential Energy Efficient Property Credit for 2009 can be Broken Down into Two Different Types of Home Improvements:
1)Residential "Renewable" Energy Tax Credit
"Renewable" Energy is Energy sources that can be replenished (made again) in a short period of time. Sunlight, wind, water, geothermal, and plants are all examples of renewable energy sources. Some Examples of these are Installing Solar Panels, Wind Turbine Systems, Solar Water Heaters. LINK Click here to learn more about the Renewable Energy Credit.
2)Residential "Energy Efficient" Tax Credit
"Energy Efficient" is to use less energy to do something as good as before or better. So when you replace old windows, doors, insulation etc. and they meet the IRS standards, you can qualify up to 30% of the cost, not to exceed $1,500 for 2009.
To See last year's tax form for Home Energy Credits- Form 5695, click here.
How do You Claim this Home Energy Tax Credit?
When you file your 2009 taxes after January of 2010, you will be filing Form 5695, "Residential Energy Efficient Property Credit". If you do your own taxes with Turbo Tax or H&R Tax Cut, the Form 5695 is included which makes it a snap. It will let you know how much you can get a home energy credit for that year..or if you have to carry-over any of your Home Energy credits to the next year. You probably won't have to send in your certificates and/or receipts to verify to the IRS that the work was done, BUT is always good practice to make copies or originals and keep them on hand for 7 years. If you are mailing in your return, verses 'e-file' as most of us do...I would send the copies of the certificates and or receipts at that time. It is better to give the IRS more documentation than less.
Home Energy Credit, money in YOUR pocket!
What the Home Energy Tax Credit Actually DOES for US.........
Home Energy Credits, like all credits, actually lowers the amount of tax you owe...Take note, don't look at your refund amount...BUT the amount of tax you owe (line 46 on your 1040 Tax return) ... which most of us have started paying that debt off by deduction from our paycheck on our W-2's. So if your tax is $5,000, the Residential Energy Tax Credit can lower that amount up to the $5,000 in this example.... And you will probably get a nice refund. Please note, however, if your tax is $0, the Energy Credit
will be zero for 2009. However, depending on your
situation,it may be carried over to your 2010 taxes.
What about Energy REBATES or GRANTS?
What energy rebates are available are (or grants) are generally offered by YOUR state.
Click HERE for more details....
Additional Information for United States Visitors: Check out the "Database of State Incentives for Renewables and Efficiency" for special federal, state, local and utility Incentives.
CLICK HERE
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