Making green home improvements can be a wonderful thing to do, not only for the warm and fuzzy feeling it gives you inside from the realization that you are helping the environment, but also from the knowledge that you might be getting a little something extra in the way of tax credits for your efforts. Gone are the bigger tax credits of 2010, but don’t give up just yet, there are still tax credits out there for certain home improvements, and not taking advantage of these credits could cost you some hard earned money.
Times are tough, and many of us can use every extra dollar we can lay our hands on whether it’s in the form of straight up cash or tax credits. And while home improvements might not be on the top of the list for what to be doing with your money right now, when maintenance issues arrive on the home front, it can cost you a lot more down the road if you ignore them. So if you’re going to do some home improvements, you might as well look for ways to get a little money back in the process.
Federal Benefits
It is important to note that unless you are willing to play the tax credit roulette wheel, you should first check to make sure the improvements you plan to make to your home qualify for a tax credit. There are certain rules, regulations, requirements, and efficiency standards that your purchases must meet in order to make them eligible.
That being said, there are a number of modifications or installations you might make to your home that would entitle you to federal tax credits. From insulating material, doors, and roofs to heat pumps, HVAC systems, solar energy systems, and more, there are numerous home improvement options that could earn you a tax credit of up to $500, which is nothing to sneeze at.
To find out exactly what the standards for tax credits are, how they apply to your home improvement options, or just to find responses to unanswered questions at the site’s FAQs page, visit www.energystar.gov.
Lesser Realized Benefits
When it comes to taxes and home improvements, you must sometimes think outside the box as to where there could be additional advantages. Sure, there are the standard tax benefits in the form of credits, but your home improvements could be saving you on taxes elsewhere.
Have you ever looked at your natural gas, electric bill or water bill and how the charges are broken down? If not, next time they arrive you might want to glance over these charges. You could be surprised to find that you are likely being taxed for your utility consumption at the state and possibly at the municipal level as well. While the rates may vary depending various factors, it is important to realize that your home improvements could earn you additional tax savings through energy efficiency or reduced water consumption, and while this isn’t a tax credit in the typical sense of the word, it is a tax savings — and it’s tough to deny that every little bit counts.
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