Can I get a tax break for winterizing my home this year?
Yes, you can. In fact, the federal tax credit for energy-efficient home improvements was expanded for 2009 and 2010 to cover many more categories than in the past. So winterizing your home will not only help you save on energy costs now but also save you money when you pay your taxes next spring.
The credit is worth 30% of the cost of qualifying energy-efficient windows, skylights, doors and roofs, plus certain types of insulation, up to $1,500, for 2009 and 2010 combined (installation costs for the improvements do not count). So if you spend up to $5,000 on any of these qualifying expenses to winterize your home before December 31, you could lower your 2009 tax bill by as much as $1,500. The cost of purchasing -- and installing -- certain high-efficiency heating and air-conditioning systems, water heaters and stoves that burn biomass qualify for the credit, too.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
You don’t have to itemize to get the credit. But you will need to submit Form 5695 when you file your taxes.
You can get an even bigger tax break for big-ticket home improvements, such as the cost to purchase and install a geothermal heat pump, solar water heater, solar panels, fuel cells or small wind-energy system (as long as no part of the system is used to heat a swimming pool or hot tub). You get the same credit worth 30% of the cost of the improvements, but there is no maximum dollar amount.
See The Tax Incentives Assistance Project and the Environmental Protection Agency’s Energy Star Web site for more information.
Got a Question? E-mail me at askkim@kiplinger.com.
-
Take Charge of Retirement Spending With This Simple StrategyTo make sure you're in control of retirement spending, rather than the other way around, allocate funds to just three purposes: income, protection and legacy.
-
Here's How To Get Organized And Work For YourselfWhether you’re looking for a side gig or planning to start your own business, it has never been easier to strike out on your own. Here is our guide to navigating working for yourself.
-
It’s Not Too Late to Boost Retirement Savings for 2018retirement Some retirement accounts will accept contributions for 2018 up until the April tax deadline.
-
How to Correct a Mistake on Your RMDs from IRAsretirement If you didn't take out the correct required minimum distribution because your brokerage firm made a mistake, the IRS may show some leniency.
-
Ways to Spend Your Flexible Spending Account Money by March 15 Deadline
spending Many workers will be hitting the drugstore in the next few days to use up leftover flexible spending account money from 2018 so they don’t lose it.
-
Making the Most of a Health Savings Account Once You Turn Age 65
Making Your Money Last You’ll face a stiff penalty and taxes if you tap your health savings account for non-medical expenses before the age of 65. After that, the rules change.
-
Reporting Charitable IRA Distributions on Tax Returns Can Be Confusing
IRAs Taxpayers need to be careful when reporting charitable gifts from their IRA on their tax returns, or they may end up overpaying Uncle Sam.
-
When You Can Expect to Receive Your Tax Refund
taxes The quickest way to receive your tax refund is to file electronically and have the money directly deposited into your bank account.
-
How a Move Can Change Your 529 Plan Tax Deduction
529 Plans The tax deduction you get for contributing to your state’s 529 plan can disappear if you move to another state.
-
Tap an IRA Tax-Free With an HSA Rollover
IRAs You can convert tax-deferred money in a traditional IRA into tax-free cash by rolling it over to a health savings account and using it to pay for medical bills.
