New (And Recycled) Tax Credits For Going Green

Image by aflcio2008 via Flickr

President Obama has made some changes to the tax credits for energy efficient products. The American Recovery and Reinvestment Act of 2009 is the program that President Bush initiated several years ago and was to end in 2007 and then was extended to end of 2008. On February 17, 2009, President Obama signed a stimulus bill (The American Recovery and Reinvestment Act of 2009) that made some significant changes to the energy efficiency tax credits. The changes are very significant for new homes and remodels. The highlights are:

• The tax credits that were previously effective for 2009, have been extended to 2010 as well.
• The tax credit has been raised from 10% to 30%.
• The tax credits that were for a specific dollar amount (ex $300 for a CAC), have been converted to 30% of the cost.
• The maximum credit has been raised from $500 to $1500 for the two years (2009-2010). However, some improvements such as geothermal heat pumps, solar water heaters, and solar panels are not subject to the $1,500 maximum - you get 30% Tax Credit on these! $1,500 is the maximum total amount that can be claimed for all products placed in service in 2009 & 2010 for most home improvements, EXCEPT for geothermal heat pumps, solar water heaters, solar panels, fuel cells, and windmills which are not subject to this cap, and are in effect through 2016!
• The $200 cap on windows has been removed, but the requirements for windows has been increased significantly. Not all ENERGY STAR qualified windows will qualify.

See more info on saving tax dollars when you build or remodel.

Thanks - Dennis Mercer