Napier & Company, LCC

Non-business Energy Property Credit

Homeowners who take energy saving steps may get bigger tax savings as the non-business Energy Property Credit, a tax credit for making energy efficient improvements to homes, has been increased.

Things you need to know about the Non-business Energy Property Credit:

• There is an increase in the credit rate to 30 percent of the cost of all qualifying improvements and an increase in the maximum credit limit to $1,500 for 2009 and 2010 combined. Spending as little as $5,000 can save up to $1,500 on your income tax return.

• The credit applies to improvements such as insulation, energy-efficient exterior windows and energy-efficient heating and air conditioning systems.

• To qualify as energy efficient, products must meet higher standards than the standards for the credit that was available in 2007.

• Manufacturers must certify that their products meet the new standards and they must provide a written statement to the homeowner.

• Qualifying improvements must be placed into service after December 31, 2008, and before January 1, 2011.

• The improvements must be made to the taxpayer's principal residence located in the United States.

• Taxpayers must claim the credit on the tax return for the year that the improvements are made. This may be different than the year the improvements were paid for.

If you are a homeowner who has been considering some energy efficient home improvements you may find these tax credits applicable to your situation.