The White House and Congress announced this week a tax package that includes Energy efficiency tax credits for homeowners. These had previously expired in 2011 and will be reinstated retroactively for 2012 and extended into 2013. Energy efficiency tax credits provide a powerful incentive for homeowners who wish to enjoy lower energy bills and increased comfort in their homes.
“Energy efficiency is a sound investment at the local as well as the national level. All of us would like to lower our operating costs and have more leftover every month for other pressing expenses,” says Cynthia Adams, Executive Director of the Local Energy Alliance Program. “LEAP can help property owners bundle federal tax credit savings, local tax credits and other cash rebates to make even more affordable the installation of energy improvements. Plus we have very low interest loans available through our financing partner, the UVA Community Credit Union.”
The legislation, better known as the American Taxpayer Relief Act of 2012, includes energy tax credits for both new home construction and for existing homes. However, the more substantial of the two tax credits is the energy efficiency improvements to existing homes, which received almost 92% of the $2.4 billion in total funding.
The bill extends the credit under Section 25C of the Code for energy-efficient improvements to existing homes, reinstating the credit as it existed before passage of the American Recovery and Reinvestment Act. This 10% of project cost tax credit can be used for a wide variety of energy efficiency improvements, including:
• Added insulation to walls, ceilings, or other part of the building envelope that meets the 2009 IECC (& supplements) specifications.
• Replacement windows and skylights, and exterior doors which meet ENERGYSTAR ® guidelines. The credit covers 10% of the material cost, up to $200.
• Window films certified by the manufacturer that the product meets the requirements of a “qualifying insulation system.”
• Sealing cracks in the building shell and ducts to reduce infiltration and heat loss – these should be sealed so as to be consistent with the 2009 IECC.
• Pigmented metal roofs, or an asphalt roof with cooling granules must meet Energy Star requirements.
• An electric heat pump water heater , which yields an energy factor of at least 2.0 in the standard Department of Energy test procedure.
• Natural gas & propane furnaces must meet an Annual Fuel Use Efficiency (AFUE) 95 or higher, oil furnaces and gas, oil and propane boilers must meet an AFUE of 90 or better. The credit covers costs up to $150.
• Central air conditioning units and air-source heat pumps must meet the highest tier standards set by the Consortium for Energy Efficiency (CEE) as of February 17, 2009, which in most cases requires a Seasonal
• Energy Efficiency Ratio (SEER) of 16. SEER measures performance throughout the cooling season. The credit covers costs up to $300.
• A natural gas, propane, or oil water heater , which has an energy factor of at least 0.82 or thermal efficiency of at least 90 percent.
• A biomass fuel property, which is a stove that burns biomass fuel to heat a dwelling unit located in the United States and used as a principal residence by the taxpayer, or to heat water for such dwelling unit, and that has a thermal efficiency rating of at least 75 percent.
These energy efficient improvements support the legislation’s goal of making America more energy independent by lowering overall demand. “Tax incentives for energy efficiency have a provided a major stimulus to the insulation industry and our experience on the local level has been positive as well. These credits support American jobs using 100% American made materials while saving money for the consumer and reducing the impact of fossil fuels on our environment. Win,win, win!” says James Sullenberger of Weatherseal Insulation company.
To learn more contact the Local Energy Alliance Program (LEAP), your local non-profit organization Home Performance with ENERGY STAR sponsor. We provide unbiased counsel to local homeowners on how they can leverage rebates up to $1000 for energy efficiency improvements on their home, based on the location and size of the project. We also provide free energy benchmarking services for commercial businesses. To contact LEAP, call -800-646-0717 or go to www.leap-va.org. Now is a great time for property owners to upgrade their home’s efficiency and take advantage of these combined financial incentives.
Download the PDF for Customer Reference, by CLICKING HERE.
Provided by the Energy Efficiency Buisness Coalition. Source: Senate Bill HR8 – Tax Payer Relief Act of 2012 – PDF
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