Tax Credits - Energy Star, Energy Efficiency Tax Credit & Rebates

Sometimes you have to spend money to save money, even if it seems counterintuitive. In today’s economy, it may be difficult, but after reading this hub you may be more willing and motivated to save for one or more new energy efficient appliances. When you consider how much energy efficiency can save you against the one-time cost of improvements, it may seem like a no-brainer.

There are two ways that making your home more energy efficient can put more money in your wallet:

1. you will see the savings every month on your energy bill, and

2. you can take advantage of the current federal energy efficiency tax credits, like the cash for caulkers program. By making your home more efficient, you can also reap the benefit of making it greener and helping the environment for you and your family.

The American Recovery and Reinvestment Act provides the most generous home improvement rebates for energy efficiency and homeowners and condo owners have until the end of 2010 to take advantage of it.  Under this act, homeowners can qualify for up to 30% of the cost of qualifying energy efficient improvements, up to $1500.  You can stock up on materials now to make the most of the tax credit, even if you can’t get around to some of these projects by the end of the year.

Here are some improvements that you may want to consider: 

According to Energy Star, a government program that identifies and promotes energy-efficient products, upgrading windows, doors, and even skylights to energy-efficient ones can lower your energy cost by up to 24%.  You can also add a new energy efficient window to your home and receive a tax credit for a portion of the cost.

If you are unable to make structural changes to your home or cannot afford it right now, you can still reduce your energy costs with window treatments.  Insulated curtain panels, high reflectivity film, shades and shutters can all do the trick, but these are not eligible for tax credits. 

Most appliances that are Energy Star certified are eligible to get you a tax credit.  These appliances use ten to fifty percent less energy than non-Energy Star certified models.

You may not be eligible for a tax rebate for these, but adding a timer to your electric water heater or a programmable thermostat will cut your energy costs and save you more than enough money to pay for themselves and more.

Heating and Cooling System Upgrades

According to Energy Star, properly insulating and sealing your home can save you up to ten percent on your annual energy bill.  These improvements will qualify for tax credits as long as you comply with the 2009 International Energy Conservation Code and Amendments.

When planning future improvements or builds, think green.  Geothermal heat pumps, small residential wind turbines, and solar-energy systems may qualify you for up to a thirty percent tax credit (with no upper limit for new construction) through 2016.

Also, residential fuel cell and microturbine systems installed in your primary residence can qualify for up to a thirty percent credit, up to $500 per half kilowatt or power capacity. 

The U.S. Department of Energy has partnered with building professionals to create Zero Energy Homes that utilize more efficient construction and renewable technologies like solar water heaters. The goal is to develop homes than not only use less energy, but produce their own energy. The excess energy produced by these homes can be picked up by the grid and, depending on the utility company, homeowners can receive credit or cash for it.

• Go to enerygysavers.gov to find out about Energy Star appliance rebate programs in your state.
• Check out the IRS.gov website to learn more about federal tax credits.
• Greenhomeguide.com can help you find more eco-friendly ideas and advice.
• Epa.gov can also provide you with green tips for your home.

• For alternative fuel vehicles you can get a credit of up to $4000.
• Plug-ins can get you up to a $7500 credit (amount depends on the battery capacity used to help power the vehicle.)
• Fueleconomy.gov can help you find qualifying makes and models.