Energy Policy Act of 2005 Tax
Credits includes:
IRS Form
5695 Resident Energy Credits
Home Energy Efficiency
Improvements
Tax credits are available for many types of home improvements
including adding insulation, replacement windows, and certain
high efficiency heating and cooling equipment. The maximum
amount of homeowner credit for all improvements combined is $500
during the two year period of the tax credit. This tax credit
applies to improvements made from January 1, 2006 through
December 31, 2007.
Solar Energy Systems
Tax credits are available for qualified solar water heating and
photovoltaic systems. The credits are available for systems
"placed in service" in 2006 and 2007. The tax credit is for 30
percent of the cost of the system, up to $2,000. This credit is
not limited to the $500 home improvement cap.
* Reminder: Unlike a deduction, which reduces the amount of
income subject to tax, a tax credit directly reduces the tax
itself. The final rules and forms to clarify which products and
services qualify for the tax credits will be developed by The
Internal Revenue Service (IRS). You must refer to the final IRS
rules to determine what qualifies for the tax credit.
Energy Policy Act of 2005 Tax
Credits for Home Builders:
Home builders are eligible for a $2,000 tax credit for a new
energy efficient home that achieves 50 percent energy savings
for heating and cooling over the 2004 International Energy
Conservation Code (IECC) and supplements. At least 1/5 of the
energy savings must come from building envelope improvements.
This credit also applies to contractors of manufactured homes
conforming to Federal Manufactured Home Construction and Safety
Standards.
There is also a $1,000 tax credit to the producer of a new
manufactured home achieving 30 percent energy savings for
heating and cooling over the 2004 IECC and supplements (at least
1/3 of the savings must come from building envelope
improvements), or a manufactured home meeting the requirements
established by EPA under the ENERGY STAR program.
Please note that, with the exception of the tax credit for an
ENERGY STAR qualified manufactured home, these tax credits are
not directly linked to ENERGY STAR. Therefore, a builder of an
ENERGY STAR qualified home may be eligible for a tax credit but
it is not guaranteed.
These tax credits apply to qualified new homes built or produced
12/31/05 through 12/31/07.
(resource: Energy Star energystar.gov)
