Return To Blog

Factor In These Energy Efficient Tax Credits on Your Denver Tax Return

October 19, 2016

When you prepare your Denver tax return, it’s important to work with a professional who can help you locate any tax credits that may apply to you. However, if you choose to prepare your return on your own, you need to be familiar with the various tax credits available to homeowners. For example, did you know you may qualify for credits if your home has energy efficient features? It’s true! Here are the three energy efficient credits you should know about:

Non-Business Energy Property Credit

Have you made any energy efficient upgrades in your Denver home over the last twelve months? If so, you may qualify for the non-business energy property credit. Homeowners can claim up to 10% of the cost of certain energy efficient upgrades including insulation, and energy efficient windows, roofs, and doors. In some circumstances, such as when you install a new, energy efficient water heater, you may be able to recoup the entire cost of the appliance. But, keep in mind there is a maximum limit of $500 on this credit, so don’t expect to claim higher than this amount. You should also be careful when deciding which appliances and energy efficient products to buy for your home. Not every product will count towards this credit, so be sure to do your research to make sure you are choosing one that will save you money. Learn more about how you can get credit for making your home energy efficient.

Residential Energy Efficient Property Credit

This credit was designed to encourage homeowners to use alternative energy sources, such as solar or wind power. If you have installed any equipment in your home such as a solar water heater or solar panels on your roof, you may qualify to receive up to 30% of the cost with the help of this credit. Unlike the previously mentioned tax credit, there is no limit on this one, so even if your credit comes out to more than you actually owe for your annual taxes, the balance will carry over to the next year.

Energy Efficient New Homes For Home Builders

Although this one won’t apply to as many people as the first two, it is still worth mentioning in this round-up of energy efficient tax credits. Home builders will qualify for a tax credit of up to $2,000 if the homes they are building meet certain standards. First, the homes must comply with Federal Manufactured Home Construction and Safety Standards. The homes also must meet certain energy saving requirements, meaning they have to be designed to reduce energy consumption. If the homes can reduce heating and cooling energy consumption by at least 50%, then the home builder qualifies for up to $2,000. However, if the home is built to only reduce heating and cooling costs by 30%, then the home builder may qualify for a credit of up to $1,000.

Do you need help finding applicable tax credits? Bloch, Rothman & Associates, Ltd. is a full service accounting firm offering personal and affordable Denver tax and accounting services for individuals and businesses. Contact Block, Rothman & Associates in Denver for a free initial consultation.