Weatherford Democrat

December 6, 2007

Warm up with an energy tax credit


Special to the Democrat

DALLAS — The Internal Revenue Service reminded taxpayers recently that tax credits are still available to make homes more energy efficient. You can make energy-conscious purchases that will provide tax benefits when filling out returns next year. The law covering tax years 2006 and 2007 provides for these credits when you purchase and install certain items.

The maximum credit for both taxable years is $500, no more than $200 of the credit can be attributable to expenses for windows. These items must have been placed in service after Dec. 31, 2005, but before Jan. 1, 2008.

“With cold weather on the way, folks may be thinking about adding insulation or maybe a new heating system to their home, so, it’s well worth the time to take a look at Form 5696, Residential Energy Credits, available online at IRS.gov,” said Dallas-based IRS spokesman Clay Sanford.

A tax law change, Energy Policy Act of 2005, provided a tax credit to improve the energy efficiency of existing homes. To qualify, improvements must be installed in or on the taxpayer’s principal residence in the United States.

The following items may be eligible:

n Insulation systems that reduce heat loss/gain.

n Exterior windows (including skylights).

n Exterior doors.

n Metal roofs (meeting applicable requirements).



In addition, the law provides a credit for costs relating to residential energy property expenses. The following items may be eligible:

n $50 for each advanced main air circulating fan.

n $150 for each qualified natural gas, propane, or oil furnace or hot water heater.

n $300 for each item of qualified energy efficient air conditioning or heating equipment.



For more information, go to the IRS.gov Web site and access Form 5696, Residential Energy Credits.