Tax Tips: Go Green, Save Green

The new energy credit for 2009 and 2010 is available on these items purchased for your primary personal residence only:

  • Energy-efficient windows
  • Skylights
  • Central air conditioners
  • Electric heat pumps
  • Water heaters
  • Exterior doors
  • Insulation
  • Natural gas, propane or oil furnaces
  • Natural gas, propane or oil hot water boilers
  • Biomass fuel stove
  • Main air circulating fans
  • Pigmented metal and reflective asphalt roofs

If your home is used partly for business, such as with a home office or a two-family building with one half rented, you must allocate the cost of qualifying property between personal and business use. Only the personal portion will qualify for the credit.

If you purchased an item that qualifies for the credit you should have received a “manufacturer’s certification” from the vendor. If you are not sure if an item you purchased qualifies you can go to the Energy Star Web site.

A client of mine recently encountered a question about the enrgy credit and installation costs. You can include in the amount available for the credit “expenditures for labor costs properly allocable to the onsite preparation, assembly, or original installation of the property” for qualifying heating, ventilation and air conditioning systems, biomass stoves and water heaters.

Installation costs are not included in the amount available for the credit for windows, doors, installation or roofs. The credit for these items is limited to 30% of the cost of materials only, up to the $1,500 maximum.
— Robert D. Flach

Consumerist has teamed up with MainStreet.com to bring you tax tips every day between now and April 15th. This frees up Tax Cat to do more important things — like trying to claim hairball meds and catnip as business expenses.

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