Get Your Stimulus On!

We’re almost into November, which means planning the holidays, scoring last minute Halloween candy, and readying the house for winter, even if you live in Los Angeles.  It’s also the time to sort out your favorite charities for tax-deductible donations, max out your health insurance plans, and scrounge for purchases for which you can get a tax rebate:  which is why I’m bringing up the Energy Star tax credits you can earn while making your home energy efficient!

For consumers, the EPA and Department of Energy are offering these tax credits that are part of the Obama Administration’s ARRA stimulus legislation.  For existing homes, as in, the home in which you currently live, you can receive 30% of the costs you invested, up to a maximum of $1500, by installing Energy Star rated:

• Windows and doors
• Insulation
• Roofs
• HVAC (air conditioning and heating systems)
• Water heaters
• Biomass stoves (for those lawn clippings and leftover crops with which you planned on heating your stove)

Here’s the deal:  the credit is a total of $1500 per person . . . you could receive, say, $500 for this year and $1000 next year if you only have time to cram in some insulation before December 31.  If you co-own a home with someone, each person can individually receive up to $1500 in tax credits (i.e. $3000 divided between the two of you).

For new and existing homes, you can gain up to 30% of the purchase price through 2016, with no limit, for installing in existing OR newly built homes:

• Geothermal heat pumps
• Solar panels
• Solar water heaters
• Small wind energy systems
• Fuel cells

My first gut reaction was that the last five options were very pie in the sky options:  however, I believe it was wise to give home owners more time to invest in solar, wind, and other technologies because they can only get cheaper as more of them come to market . . . that’s my hope, at least!

Go to the government’s Energy Star site and see for yourself. Generally the site is easy to read and the FAQs are comprehensive and easy to follow.  Some of these options on which you may have been procrastinating, such as the insulation or new doors, are perfect for completing now in maximizing your tax return.

And as always . . . consult your tax advisor to make sure you don’t botch your documentation, earning an IRS nasty-gram in the process.