Similar credits were available in 2006 and 2007 but none were available for 2008.  We will face a similar set of circumstances for 2011 unless Congress makes changes to extend or reinstate the credits.  Directly from the IRS web site, the credit is based off "of 30% of the cost of certain energy-efficient property or improvements you placed in service in 2009. This property can include high-efficiency heat pumps, air conditioners, and water heaters. It also may include energy-efficient windows, doors, insulation materials, and certain roofs." 

There are a few details of the credit that tend to cause issues for people.  First, make sure the item is one that is qualified for the credit and/or meets the criteria for that specific item.  The manufacturer and/or installer should be able to provide you with that information.  In addition, note that the total credit for combined 2009 and 2010 is $1,500.  So if you have already claimed all or a portion of the residential energy credit in these years your credit may be reduced or not available.  This oversight is a common issues when you deal with vendors or sales people and they explain the credit to you.  They don't know or care to ask the proper question to see if it is something that has been claimed in the past, which may mean you buy something with the understanding that you would get the credit and learn at tax time that you would not.  This is just another example of when it is useful to make a quick 5 minute phone call to your tax partner to run it by them.

I will be teaching a short seminar on this subject at the Green Living Expo to be held in October by the Cape Fear Green Building Alliance / Wilmington Business Journal.   More details will be made available as we approach October.

Alternative Energy Credits

 

There are alternative energy credits for things like solar, wind, etc.  These credits do not necessarily expire at the end of 2010.  I may cover them in more detail in the future.