What are 2007 Residential Energy Efficiency Credits?
RESIDENTIAL ENERGY EFFICIENCY TAX CREDIT
For tax year 2007, taxpayers will be able to take advantage of tax credits after purchasing certain products such as: insulation, exterior windows, exterior doors, HVAC systems. This energy tax credit that may be available to taxpayers provided these improvements meet very stringent federal guidelines.
FEDERAL REQUIREMENTS FOR CLAIMING 2007 THE ENERGY TAX CREDIT
Here are some of the more important Federal Requirements that taxpayers must meet in order to claim this Credit. These are as follows:
1. The improvements must made on or before December 31, 2007.
2. In order for the Energy Tax Credit to be considered, the "Improvements" must be installed in Taxpayers principal residence. Hence, it is not applicable to the 2nd Residence or any Rental Property.
3. The Government hoped to encourage Taxpayers to install these energy efficient improvements by offerring Tax Credits. However, there must be a reasonable expectation from the taxpayer of using these improvement for at least the next five years.
4. The maximum credit for available will be $500. Further, any amount received in 2006 will be offset against the 2007 credit. The IRS offerred the credit for 2 years from 2006 and 2007 and set the maximum combined credit for both years to be $500. Here are some of the specific tax credits that are available along with their limitations:
-for installing exterior windows, up to 10 % of cost up to $200
-exterior doors, up to to 10% of the cost up to $500.
-insulations up to to 10% of the cost up to $500.
-air conditioning systems up to $300.
-hot water boilers and or furnaces up to $150
5. The Taxpayer is encouraged to consult with their Tax professional to determine whether their specific home improvements meets the federal requirement guidelines that would qualify for a Energy Efficient Tax Credit.