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Tax Credits 2009

There are several programs that give tax credits for building energy-efficient structures or for adding energy-efficient features. Energy-efficiency pays, now more than ever. Here's a summary of the available programs and where to go for more information. Help with government incentives, rebates and tax credits is part of the full-service approach at EcoTechnologies.

State Incentives

Incentives and programs for energy-efficiency vary widely from state to state. 
Visit the following database to get the most up-to-date information: 
Database of State Incentives for Renewables & Efficiency

Federal Incentives

For an overview of Federal tax credits visit EnergyStar.gov.

Tax Credits for Existing Home
Energy Efficiency Improvement

What: Tax credit equal to 30% of the amount paid or incurred by the taxpayer for qualified energy-efficiency improvements installed during the taxable year through 2010

Who: Homeowners

Limit: Capped at $1,500 on any property qualifying for the credit

Claim: For Tax Purposes, save your receipt and the Manufacturer's Certification Statement. Use IRS Tax Form 5695 (version 2009).

Note: For insulation to qualify, its primary purpose must be to insulate. It must be expected to last five years OR have a two-year warranty, installation costs are not included. A Manufacturers' Certification Statement is required.

Builder Tax Credit

What: $2,000 tax credit for a new, energy-efficient home that achieves 50% energy savings for heating and cooling over the 2004 International Energy Conservation Code (IECC) and supplements. At least 1/5 of the energy savings must come from building envelope improvements

Who: Home builders

Limit: New U.S. homes whose construction is substantially completed after August 8, 2005 and that are acquired from the eligible contractor for use as a residence from January 1, 2006 through December 31, 2009

Claim: Eligible contractors should fill out IRS Form 8908

Note: This credit also applies to contractors of manufactured homes conforming to Federal Manufactured Home Construction and Safety Standards. There is also a $1,000 tax credit to the producer of a new manufactured home achieving 30% energy savings for heating and cooling over the 2004 IECC and supplements (at least 1/3 of the savings must come from building envelope improvements), or a manufactured home meeting the requirements established by the EPA under the ENERGY STAR program.

Commercial Tax Deduction

What: Tax deduction of up to $1.80 per square foot for new or existing commercial buildings that save at least 50% of the heating and cooling energy of a building that meets ASHRAE Standard 90.1-2001

Who: Owners or designers of new or existing commercial buildings

Limit: Available for systems "placed in service" from January 1, 2006 through December 31, 2013

Note: Partial deductions of up to $.60 per square foot can be taken for measures affecting any one of three building systems; the building envelope, lighting, heating and cooling systems.

For more information: Commerical Tax Deduction Requirements (DOE)

TAX Credit Most FAQ

How many tax credits are there?
There are two tax credits and a tax deduction.  There is a tax credit for builders on new construction, a tax credit for homeowners who make energy efficient upgrades to their existing homes, and a tax deduction for commercial property owners who reduce energy consumption of their buildings.

How does a builder get the new construction tax credit?
A builder must design the house to be 50% more efficient than a model IECC home.  You can use numerous approved computer software to accomplish this.  You must then build the home to those specifications and have an energy rater come out and do a performance test on the house.

How does foam insulation fit into the new construction tax credit?
The tax credit requires that 1/5 of the efficiency come from building envelope components.

Do I have to turn in new paperwork to the IRS to qualify for either of the two tax credits?
Yes, IRS Form 8908 (available from irs.gov). You must also keep your receipts and your documentation that your home meets the standards.

What is the new construction tax credit?
Home builders are eligible for a $2,000 tax credit for a new energy efficient home that achieves 50 percent energy savings for heating and cooling over the 2004 International Energy Conservation Code (IECC) and supplements. At least 1/5 of the energy savings must come from building envelope improvements. These tax credits apply to new homes whose construction is substantially completed after January 1, 2006 and that are acquired from the eligible contractor after January 1, 2006 and before December 31, 2009, for use as a residence.

What is a tax credit?
You don’t receive an income tax credit when you buy the product, like an instant rebate. You claim the credit on your federal income tax form at the end of the year. The credit then increases the tax refund you receive or decreases the amount you have to pay.

Tax credits vs. tax deductions
In general, a tax credit is more valuable than a similar tax deduction. A tax credit reduces the tax you pay, dollar-for-dollar. Tax deductions – such as those for home mortgages and charitable giving – lower your taxable income. If you are in the highest 35-percent tax bracket, the income tax you pay is reduced by 35 percent of the value of a tax deduction. But a tax credit reduces your federal income tax by 100 percent of the amount of the credit.

What energy-efficient home improvements are eligible for existing homes?
The overall $500 cap can be reached in several ways with the purchase and installation of energy-efficient products:

  • Exterior windows: 10 percent of the total cost, up to $200. Includes skylights and storm windows.
  • Insulation, exterior doors, or pigmented metal roofs: 10 percent of the cost of the product (but not the installation), up to $500. Includes seals to limit air infiltration, such as caulk, weather stripping, and foam sealants, as well as storm doors.
  • Central air conditioner, heat pump, or water heater: up to $300 towards the full purchase price, including installation costs.
  • Furnace or boiler: up to $150 towards the full purchase price, and/or $50 for an efficient air-circulating fan in a furnace, including installation cost.

EcoTechnologies Contact Information

EcoTechnologies, Inc. | Florida's EcoSquad
2101 47th Street, Sarasota, Florida 34234
Sarasota/Manatee 941-364-5900 | Hillsborough 813-865-1304 | Pinellas 727-258-0006 | Toll Free 888-522-3626

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