As tax season approaches, familiarize yourself with these energy efficiency tax credits

Recently in this blog we wrote about some of the key tax credits that made it into the American Taxpayer Relief Act of 2012 as part of the fiscal cliff deal – specifically those that benefit individuals who have made or plan to make energy-efficient upgrades to their homes. With tax season just around the corner, homeowners are encouraged to speak with their advisers about how they can take advantage of these government benefits. 

The best news of all is that the credits can be applied not only to all projects moving forward through December 31, 2013, but also retroactively to any upgrades that were implemented in 2012. Homeowners cannot exceed the $500 cap for all improvements combined, however in many cases, the full cost of any heating, cooling and water-heating equipment purchases will be covered. An electric heat pump water heater with an energy factor of at least 2.0, for example, may be reimbursed up to $300. A full list of credits can be found here.

Whether or not these tax credits will be renewed once they expire at the end of 2013 is still uncertain, however sources are reporting that the future of this kind of compensation is looking bright so far. 

“Beyond 2013, the outlook is unclear but at a recent Senate Finance Committee hearing on energy efficiency tax incentives, multiple Senators expressed support for continuing some type of incentives,” writes industry news source The Energy Collective. 

With these credits in mind, 2013 might be a great time for individuals to make energy-efficient upgrades to their homes. To get started, contact a home inspection contractor. They can perform an energy audit and help you determine next steps.