Video: Save Taxes by Saving Energy
If taxes don't usually give you a warm, cozy feeling, this winter might change your mind.
Hi, I'm Tiffany Smith from TurboTax with an update on the American Recovery and Reinvestment Act of 2009.
From basements to attics, the federal government wants homeowners to save energy year-round. They're even willing to pitch in with tax credits for energy-efficient improvements, like replacing an aging furnace or drafty windows and doors.
Install energy-efficient air conditioning or go green with a solar hot water heater or geothermal heat pump. If they meet government standards, they're all eligible.
Tax credits match up to 30% of the price tag, to a limit of $1,500. That's for 2009 and 2010 combined, not per year. Invest $1,000 to add energy efficient windows, doors or skylights to your home and you'll receive a credit worth $300. Invest $5,000 to receive the maximum credit.
Better still, the tax credits come right off your next income tax bill dollar for dollar.
Some things to remember:
- Homeowners must adhere to the energy-saving standards found at www.EnergyStar.gov.
- The new standards are higher than those issued in 2007.
- Credits apply only to upgrades to primary homes.
- Rental or vacation homes don't get the tax break.
For more information about home improvement credits, deductions and other tax tips, visit TurboTax.com.
