As part of an effort to reduce dependence on foreign sources of energy, the American Recovery and Reinvestment Act of 2009 provides a tax credit to help offset the costs of making energy efficiency improvements to your home. Some key details of the program are as follows:
• The tax credits apply to a variety of products (including installation
costs) such as windows, doors, heating and cooling equipment and more.
• The
amount of the credit is equal to 30% of the installed cost of the qualifying
products, up to a total of $1,500.
• If a qualifying purchase is not large
enough to qualify for the maximum credit of $1,500, the remaining available tax
credit can be claimed for additional qualifying purchases.
The reason many homeowners are so excited about this program is because tax credits, unlike deductions, are subtracted directly from the total amount you owe on your personal income taxes. For example, if you complete your tax return and calculate that you owe the IRS $2,000, a tax credit of $1,500 will reduce your tax bill to only $500. Of course, be sure to check with your tax adviser on how to best take advantage of the tax credits.
To take advantage of the American Recovery and Reinvestment Act of 2009 tax
credits, you must purchase your qualifying high-efficiency comfort system
between January 1, 2009 and December 31, 2010.