Tax Time – The Home Improvement Tax Credit

Now that we’re in the new year, it’s time to start thinking about your taxes.  Did you know there is a very generous federal tax credit for certain energy efficiency upgrades?  The Home Improvement Tax Credit of 2010 provides an incentive of 30% of the cost of the improvement (up to $1,500). In order to qualify, the improvement must be completed by December 31, 2010 and performed on your principal residence.

The 2010 tax credit can be taken on the following items, but check the Energy Star website to see if the specific product or appliance qualifies:

– Water heaters non-solar with a specific energy factor.  Tax credit includes installation costs.

– Storm windows and doors.  Installation costs are not eligible.

– HVAC units that meet certain standards, including air circulating fans, heat pumps, central air conditioning, hot water boilers, and furnaces.  Installation costs are eligible.

– Insulation.  Only the insulation costs (not installation) apply to the tax credit.  You will still qualify for the tax credit if you perform the installation of the insulation on your own.

– Biomass stoves with a thermal efficiency rating of at least 75%.  Tax credit includes installation expenditures.

– Metal and asphalt roofs that meet Energy Star requirements.  Installation costs are not eligible.

The Home Improvement Tax Credit has been renewed and amended for the 2011 tax year through the Tax Relief, Unemployment Insurance, Reauthorization, and Job Creation Act of 2010.  Though, this year’s tax credit has been reduced to 10% of the cost (up to $500).  Persons who have already taken advantage of home improvement credits in 2009 and 2010 over $500 will not be eligible to participate.

As a solar installer, we recommend our customers take measures to improve efficiency before we begin construction of their solar electric system.  There are a great number of incentives available for energy efficiency and renewable energy projects in Massachusetts and Connecticut.  Brightstar Solar is a licensed solar installer with experience working with the MassCEC and CT Clean Energy Fund rebate programs.  We have an in-depth knowledge of all of the incentives available for photovoltaic solar installations and help our customers navigate through this process. Please reach out to us if you’re interested in a complimentary solar evaluation and free estimate for your home or business in Massachusetts or Connecticut.