getting tax benefits from energy efficiency

Getting Tax Benefits from Energy

EfficiencyPresented by:

Curcuru & Associates CPA PLC

Residential Energy Property Credit

Residential Alternative Energy Credit

These credits are available for improvements and property installed in your principal residence located in the U.S.

There Are Two Credits Available

What type of purchases qualify?◦ Qualifying Energy Improvements

Involves building envelope components which are any insulation materials or systems which are designed to prevent heat loss or gain

Examples include exterior windows/doors, any metal roof with pigmented coatings, or any asphalt roof (in 2009 only) with appropriate pigmented coatings or cooling granules.

The Residential Energy Property Credit

What type of purchases qualify?◦ Qualified Energy Property

This is energy efficient building property, qualified natural gas, propane, or oil furnace or hot water boiler, or an advance main air circulating fan that meets specific performance and quality standards.

Examples: electric pump water heaters, qualified electric heat pumps, qualified central air conditioners, qualified stoves which use biofuels


How much is the tax credit?◦ The credit in 2009 and 2010 is 30% of the sum of

the amount paid by an individual for qualified energy improvements residential energy property

For 2009 and 2010, the total credit is limited to $1,500 over both years


What are the efficiency standards?◦ While you may rely on a manufacturer’s written

certification that property qualifies for the credit, YOUR SPECIFIC TAX SITUATION DETERMINES HOW MUCH, IF ANY, OF THE CREDIT YOU MAY TAKE.

◦ Requirements for Energy Efficient Improvements (for property placed in service after February 17, 2009) Exterior windows, skylights and doors must have a U-

factor and a solar heat gain coefficient (SHGC) of 0.30 or less

Insulation must be designed to reduce heat loss or gain and must meet the criteria established by the 2009 International Energy Conservation Code (IECC)


What are the efficiency standards?◦ Requirements for qualified energy property

A minimum annual fuel utilization efficiency rate (AFUE) of at least 90 is required for any natural gas, propane or oil hot water boiler, or oil furnace. The preexisting rate of at least 95 required for any natural gas or propane furnace remains unchanged

An electric heat pump or central air conditioner must achieve the highest efficiency tier established by the Consortium of Energy Efficiency (CEE)

A natural gas, propane, or oil water heater must have either a minimum energy factor of 0.82 or a thermal efficiency minimum of 90 percent.


Clear your mind…the following slides explain a completely separate energy credit.

Tax credits are available for the following alternative energy property installed in your principal residence located in the U.S.

The credit is equal to 30% of the expenditures of such equipment


Qualified Solar Electric Property◦ Uses solar energy to generate electricity

Qualified Solar Water Heating Property◦ Expenditures for property which heats water for

use in a principal residence if at least half of the energy used by the property is derived from the sun, and which is certified for performance by the non-profit Solar Rating Certification Corporation or comparable entity endorsed by the state in which the property is installed


Qualified Small Wind Energy Property◦ Expenditures for property which uses a wind

turbine to generate electricity for use in a principal residence

Qualified Geothermal Heat Pump Property◦ Expenditures for equipment which uses the

ground or ground water as a thermal energy source to heat the residence or as a thermal energy sink to cool the residence


AS ALWAYS, THE INFORMATION IN THIS SLIDE SHOW CONTAINS GENERAL INFORMATION. PLEASE CONSULT A TAX ADVISOR BEFORE ACTING ON ANY INFORMATION CONTAINED IN THIS SLIDESHOW.

THIS IS COMPLICATED STUFF, SO DON’T SAY I DIDN’T WARN YOU.

getting tax benefits from energy efficiency

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