Friday, September 24, 2010

Act now for energy tax breaks

Act soon to save some green while going green. Energy tax incentive deals expire at the end of this year and it's unclear if Congress will renew them (msn.com Sept. 10).

Consider these tax breaks but be sure to read the fine print when making purchases. Not everything advertised as "energy saving" or "energy efficient" qualifies:

The nonbusiness energy property credit equals 30% of the cost of energy-efficient products. Qualifying products include energy-saving doors, windows, insulation, metal and asphalt roofs, water heaters, biomass stoves, and heating and cooling equipment. Basically you can spend up to $5,000 on single or multiple products for your principal residence that you own and live in and get $1,500 (30% of $5,000 = $1,500) back as a tax credit. This credit can be used in 2009 and 2010. If you got the entire credit in 2009, you can't get an additional break in 2010.

Shop carefully because not all products qualify. Check the Energy Star's website and ask for the manufacturer's certification statement that verifies the product qualifies for the tax credit. Be sure to check on installation costs; they aren't covered for all products. Projects must be completed by Dec. 31.

Use Internal Revenue Service Form 5695 to claim the credit. Remember to save your receipts, any contractor certifications, and the manufacturer's certification statement.

The energy efficient appliance rebate program provides an incentive to replace older, inefficient models. Each state and U.S. territory designed its own rebate program and a few already have used up allocated funds. Some rebates require preregistration with a mail-in rebate form; others provide a voucher to use at time of purchase. Check the U.S. Department of Energy (DOE) website for details. This site is the only official DOE-sponsored site; be cautious of fake sites.

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