With both the winter and the end of the year soon to arrive, saving money on heating and filing income taxes will soon be a priority concern.
Thanks to the 2011 Federal Tax Credits for Consumer Energy Efficiency, both can be accomplished at the same time for ENERGY STAR-qualifying energy efficient products. Although the federal tax credits of 30 percent that saw returns up to $1,500 expired last year on December 31, new 2011 tax credits were passed, although at lower levels. And keep in mind that just because you have an ENERGY STAR-qualified product, it may not also qualify for a tax credit.
Those new federal tax credits expiring on December 31, 2011 can either return 10 percent of the cost of the project amount up to $500 or a specific amount ranging from $50 to $300. Projects must have been made to an existing home that serves as your principal residence — new construction and rentals will not qualify for the tax credits and the tax credits are only available on the cost of the materials and not the installation costs.
For example, biomass stoves like pellet burning heaters can return $300 for qualifying equipment with a thermal efficiency rating of at least 75 percent.
The installation of an advanced main air circulating fan, an energy efficient fan or blower motor that sends the furnace-heated air through your ducts, to an existing heating system can bring back $50 if it uses no more than two percent of the furnace’s total energy.
Insulation installation can even get you a healthy return of 10 percent of the project’s cost, up to $500. That includes insulation in the form of fiberglass batts and rolls, blow-in cellulose, or rigid, expanding or pourable materials. You can even receive a tax credit for qualifying weather stripping, cans of spray foam, caulking and house wrap that is used to seal gaps.
For tax refunds on any qualifying products that were “placed in service” during 2011, tax payers need simply to file IRS Form 5695 (the residential energy tax credit) along with their 2011 taxes by April 15, 2012. Although the 2011 version of the 1040 form is not yet available, taxpayers entered this information from Form 5695 on line 52. Be sure to save your receipts as well as the Manufacturer’s Certification Statement for your records.
For more information on the 2011 federal tax credits, log on to http://www.energystar.gov/