Go Green and Get Green From Uncle Sam With Home Improvements

May 04, 2012 No Comments by

As the tax deadline looms, there has never been a better time to research how your 2011 energy efficient home improvement projects could save you money.

The tax benefits for small home improvement projects can pay big dividends. Whether you installed energy efficient windows, purchased modern HVAC units or renovated your roofing, home owners can receive tax credits totaling $1,500. In order to qualify for the entire credit, your total home improvement spend must hit the $5,000 mark. Also, the credit is only applicable to home improvement projects in an existing primary residence. Vacation homes or rentals are not eligible.

Larger energy efficient home improvement projects can also provide major tax relief. Of course, the larger the project, the more expensive the upfront investment; therefore, the tax credit should be a secondary consideration when deciding to undertake such a project. That said, if you completed a large-scale home improvement project you are entitled to a 30% tax credit without any limitation placed on spend. For example, the completion of a $20,000 solar panel renewable energy home improvement project would result in a $6,000 tax credit. Unlike small projects, large renewable energy projects can involve new or current homes as well as secondary properties.

It is important to reemphasize that the tax credit benefits of small and large energy efficiency home improvement projects should not be the basis of your final decision. Home owners should weigh need with budget to come up with a sound home improvement strategy.

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