Changes in 2009 to the energy efficiency tax credits
Significant changes to the energy efficiency tax credits were made, applying to products "placed in service" in 2009.
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 have been converted to 30% of the cost.
- The maximum credit has been raised from $500 to $1,500 total for the two year period (2009-2010). However, some improvements such as geothermal heat pumps, solar water heaters, and solar panels are not subject to the $1,500 maximum.
- The $200 cap on windows has been removed, but the requirements for windows has increased significantly.
Home Improvements
Tax credits are now available for home improvements:
- must be "placed in service" from January 1, 2009 through December 31, 2010
- must be for taxpayer's principal residence
- $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
- must have a Manufacturer Certification Statement3 to qualify
- for record keeping, save your receipts and the Manufacturer Certification Statement
- improvements made in 2009 will be claimed on your 2009 taxes (filed by April 15, 2010) — use IRS Tax Form 5695 (2009 version) — it will be available late 2009 or early 2010
- If you are building a new home, you can qualify for the tax credit for geothermal heat pumps, photovoltaics, solar water heaters, small wind systems and fuel cells, but not the tax credits for windows, doors, insulation, roofs, HVAC, or non-solar water heaters.
Complete and updated information about tax credits is available online at energytaxincentives.org. Information on energy efficient products can be found at energystar.gov. Avista has made every effort to describe the tax credits accurately; however, Avista cannot provide specific tax advice and recommends that you contact a tax professional with specific questions.
Avista incentive programs that may qualify for a Federal Tax Credit: