If you are thinking about making your home more energy efficient, this year is the perfect time. There is a federal tax credit in effect that makes you eligible for up to a $500 credit when you make energy-efficient home improvements.
The Energy Policy Act of 2005 is in effect for improvements up to December 31, 2007. That give you almost the whole year to plan and improve. I am a big fan of making our home more energy efficient. After all, it saves big money in the long run, and may even make your house more valuable when it comes to selling it later.
We will be moving in April to an older home, and I know we will need to do a lot of improvements. With the costs of heating and electricity, becoming energy efficient is a real priority for us.
My philosophy is always to save more rather than earn more. Both would be nice of course, but at least I’m not paying taxes on what I save by conserving.
A sample of some of the improvements that you can make that would fall under this tax credit include the installation of a high-efficiency water heater. This is what I have my eyes on. It would mean no more luke-warm showers and plenty of heating savings through the years. You can receive a $300 tax credit for this installation.
And, if you would rather be a little more off-the-grid, the installation of a solar hot water system can net you a credit for up to 30 percent of the cost.
Another way to get this tax credit is by installing additional insulation. Who couldn’t use more insulation in their house? For additional insulation, you can earn back 10 percent of the cost in a tax credit, up to that $500 limit.
The Energy Star website has a complete list of all of the federal incentives that are currently available. You can click here to go to the Energy Star site. So if you were thinking of improving your home this year, why not pick one of these projects and get something more back!
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