Energy Efficient Tax Credits

Yes, it's applicable to years 2009 and 2010 and the $1500 credit is the total for the two years combined.

See Notice 2009-53

Can you get a $1500 credit more than once, for different types of energy-efficient equipment? For example, if you do three projects:

- Energy efficient windows

- Energy efficient furnace

- Solar energy

Can you get $4500 of credits against the three different types of projects?

no, these are combined for the credit.

This is a diferent type of credit with unlimited creit.

A friend of mine is doing extensive re-modeling and so the two of us have been researching how and whether he can take advantage of the tax credit mentioned here. A few caveats on which I recently picked up and which are covered in Notice 9-53 above and other sites:

It generally is cost effective to replace very old windows with double- paned yada ones that meet the federal guidelines. Make sure the manufacturer assures you with documents that the windows are eligible for the tax credit. As far as the tax credit above is concerned, only

30% of the cost of the windows themselves (and not installation costs) counts towards the $1500. My friend is putting these windows in at a cost of around $2000. So right away he has used up (so to speak) $600 of the credit.

The furnaces that are eligible for the tax credit are super duper high efficiency ("AFUER" greater than or equal to 95%) furnaces for which one will pay quite a bit more compared to the lower efficiency, more standard ones. If you can justify the higher expense of such a furnace and you purchase one, then 30% of the cost of the furnace /and/ its installation can count towards the tax credit. My friend opted not to get one of the more expensive furnaces. Every contractor with whom we spoke frowned on the higher efficiency furnaces, from a cost standpoint, even with the tax credit.

Some furnaces have a high efficiency fan whose value the various IRS guides will explain partly may be counted towards the tax credit. The manufacturer should provide documents indicating which of its lower efficiency furnaces have a high efficiency fan and what fraction of the furnace cost and installation may then be multiplied by 30% and so count towards the tax credit. We are talking maybe $100 of tax credit here for this situation (fan only counts).

Were there not energy effieient tax credits from 2004 thru 2008?

Dick

It was contained in the 2005 Energy Act ( Credit for Certain Nonbusiness Energy Property [Bill §1333; Code §25C (new)]) effective for 2006 and 2007. It was not extended, so 2008 did not contain it. It was brought back to life for 2009 and 2010 with better terms.