Tips on Tax Credits

Tax Credits: Windows - What You Need to Know

The energy standards for windows have changed -- and the new tax credit standards are much higher.

Bring the NFRC label to your accountant and use form 5695

Old : Federal tax credits of were available in 2006 and 2007 by purchasing Energy Star-qualified windows based on the NRFC* ratings in four different climate zones. The old credits capped at $500 and the old standards no longer qualify.

New: The new credits apply to 30% of materials costs and limited to $1500 through the end of 2010.

The American Recovery and Reinvestment Act of 2009 (ARRA) bases their tax credits on two factors:

  • U-factor of 0.30 regardless of the climate zone. The U-factor measures the resistance to heat flow.
  • Solar Heat Gain Co-efficient of 0.30 or less. The SHGC measure how well the window blocks heat gain from the sun.

 

Team installs windows with a U-Factor of 0.30 and a SHGC of 0.19 with additional performance ratings. Be sure to get the NFRC label from your contractor, make a copy, and give it to your accountant for IRS form 5695.

Do the Math: According to the U.S. Department of Energy (DOE), your heating bill could be 10% to 25% higher because of heat loss through windows. During air conditioning season, energy efficient windows can reduce your consumption of electricity by 10% to 15%. That means that in the summer, you could save $30 a month on a $200 electric bill, or $120 each summer. In addition, these windows could potentially add $300 more dollars to your pocket in winter. But do your own math, and see what the savings and comfort could be for your home or commercial building.

What May Not Be Included: Most skylights

Not everyone qualifies, so consult with your tax adviser today, and call Team for your windows to save!Look for our upcoming tax credit updates on storm windows and doors.

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We Thank Our References

*NFRC is the National Fenestration Ratings Council http://www.nfrc.org
Grand Valley State University -- Michigan Alternative & Renewable Energy Center
Remodeling Magazine http://www.energystar.gov/taxcredits

Disclaimer

We strive to provide information that is helpful to you and well researched. However, this post can't be responsible for your unique situation. Please consult your tax adviser and use this tip to do your own research. Check with government agencies to be sure that you qualify for the credit and that the information is current to you.

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