Homeowners who make energy efficient renovations may be able to receive tax credits. Credits directly reduce the amount of tax owed and will, therefore, save money. This blog offers energy tax credit guidance for NH home owners.
Tax Credit Categories
The Wind, Solar, Geothermal and Fuel Cell Tax Credit
This tax credit can be applied to pre-existing properties and new construction, if used as principal residences. Investment properties do not qualify. Homeowners can receive a credit totaling 30 percent of the cost of repairs completed between January 1, 2011 and December 31, 2011.
The following items fall into this tax credit category:
- Geothermal Heat Pumps
- Solar Panels
- Solar Water Heaters
- Small Wind Energy Systems
- Fuel Cells (up to $500 for each 0.5 kilowatt capacity; other terms apply)
Credit for Energy Improvements
This credit covers building materials, insulation, windows, skylights, doors, roofs, air circulating fans, furnaces, and hot water boilers. There are certain requirements for each item, so refer to the tax guidelines before using the credit. There are maximum deductions on certain items such as windows. Only changes to principle residences may be used and and only items lasting 5 years or more may be included. In general, the credit is for ten percent of the purchase price up to a maximum of five hundred dollars. Once the five hundred dollars is reached, no additional amount may be taken in any future year. This is a lifetime maximum and not a recurring one.
Energy Tax Credit Guidance For NH Home Owners
With all tax credits, keep receipts to document expenditures. Also document the manufacturer and model number of all products as some have certain criteria under the tax laws. If you are unsure of how to calculate this credit or have a large number of credits in your tax return, look into using the services of a tax expert. Advanced energy tax credit guidance for NH home owners is offered at the Energy Star website. The information in this article was prepared by Customer Service at Accurate Title as is intended only as an introduction.