How to Get Energy Efficient Windows and a $1,500 Tax Credit How to Get Energy Efficient Windows and a $1,500 Tax Credit

Earlier this year, in an attempt to jump start the American economy, the Federal government passed a stimulus plan that covers many industries -- and as a part of that, on the table is up to a $1,500 tax credit for homeowners who wish to create a more energy-efficient home. A tax credit is a dollar-for-dollar reduction subtracted from what you owe the IRS. It’s a good deal.

For the homeowner determined to profit from this, the first question might be: do I have older windows? An interesting fact: a new furnace, air conditioner or solar panel is only as good as your windows. Saving energy on heating and cooling is wonderful, but if air escapes, it hadn’t been as fruitful.

However, merely buying a new window does not mean you will earn the credit. Choosing windows that qualify for the tax credit can be a challenge if you’re not armed with the right information. Therefore, it’s crucial to examine each window that you are buying to ensure that the proper energy efficient glass is installed and that the design of the window meets the requirements. For example, a casement window may have a different energy rating than a double hung window. In short, not all windows are created equal.

To qualify, windows must provide high levels of energy efficiency in two categories: reduced heat loss and reduced heat gain. Such windows can provide 47 percent more energy efficiency in the winter and up to 70 percent more in the summer.
 
Manufacturers are detailing windows that qualify for the credit. For example, Andersen Windows offers a manufacturer’s certification statement with a detailed list of all qualifying products at www.andersenwindows.com.

The details of buying energy efficient windows that qualify are as follows:

  • Windows must have a U-Factor of 0.30 and lower and a Solar Heat Gain Coefficient (SHGC) of 0.30 or lower. When comparing windows for its energy performance, be sure to check the National Fenestration Rating Council (NFRC) label that is displayed on the product. This label displays a window’s U-Factor and SHGC ratings. If the product does not have this label, then NFRC has not verified its claims. Also check with current IRS rules, as windows purchased in the first part of 2009 may have different requirements at a lower energy saving threshold.
  • Save the sales receipts and each product’s performance label. Save this information with tax documents; qualifying products must be purchased and installed between Jan. 1, 2009 and Dec. 31, 2010. In addition to your sales receipts, you will also need to save the NFRC label from each window with your tax documents.
  • Claim the credit on 2009 and/or 2010 tax filings. The new tax credits are for 30 percent of the cost of the eligible product up to a maximum limit of $1,500 combined for tax years 2009 and 2010 (including other eligible products). The credit is for the product only, and does not include installation.

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