Energy Efficient Tax Credits

You could end up putting cash back in your pocket if you spent time and money greening your home over the last year. Federal tax credits are available for products which help increase energy efficiency. The eligible federal tax credits are for non-business or residential energy properties in the 2013 tax year. There are two different lines on your tax return, 25C and 25D.

They cover specific categories of work you have done to increase energy efficiency. "You can mix and match," explains Better Building Works' Energy & Design Consultant Monica Rokicki-Guajardo. "Let's say you do a heat pump and also did some air sealing, some insulation, maybe replaced a couple of exhaust fans because that was impacting your energy efficiency, maybe you replaced the hot water heater and insulate your hot water pipes or insulated your hot water heater. All of these things when you put them together can reach that maximum 10% up to $500 tax credit."

The tax credits are only available on an existing home and your principal residence. New construction and rentals do not qualify. Keep in mind not all ENERGY STAR qualified products qualify for a tax credit. ENERGY STAR reports it distinguishes energy efficient products which, although they may cost more to purchase than standard models, will pay you back in lower energy bills within a reasonable amount of time, without a tax credit.

Qualifying products can be found here: http://www.energystar.gov/index.cfm?c=tax_credits.tx_index


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