How to Claim the Energy Efficiency Tax Credit When Buying Replacement Windows

Window replacement is a project that can qualify under the American Recovery and Reinvestment Act of 2009's Energy Efficiency Tax Credit which allows homeowners to take a credit of up to 30 percent of the cost of new windows purchased and installed in a home between January 1, 2009 and December 31, 2010. The maximum that can be taken between the two years is $1500.

Credits are generally better than a tax deduction because a credit is a dollar for dollar reduction in income tax. A deduction merely reduces the amount of income on which the tax is based.

The window's manufacturer is required to provide a written statement called the Manufacturer's Certification Statement to certify which windows qualify for the energy efficiency credit under the American Recovery and Reinvestment Act of 2009. The Statement should be kept with the homeowner's tax documents. It does not need to be filed with the tax return.

The credit can only be taken on the amount paid for the windows, not on the amount paid for installation. Be sure to obtain a sales receipt which breaks down the cost of the product and the installation. Keep this document with your tax records, too.

To prove that the windows meet the credit guidelines, also retain the NFRC labels from the window that show the energy performance ratings have been met or exceeded.

The credit is claimed on Form 5695 for the 2009 and/or 2010 years. For more information and details on the credit, visit the government's Energy Star website and consult your own tax advisor.

The Energy Efficiency Tax Credit is available when purchasing and installing new windows that meet the tax credit requirements. Be sure to follow the steps necessary to take advantage of the tax credit.

To read more about replacement windows and saving energy, check out the article Window Replacement Saves Energy and the Environment.

And if you live in or near Manassas, Woodbridge, Warrenton, Lake Ridge, Gainesville, or Chantilly, Virginia, feel free to contact Greco Remodelers, Inc., for a free no cost, no pressure estimate for your Manassas replacement window project or call us at 703-369-4446.

P.S. For more ideas about replacement windows for your home, check out our new video, Manassas Window Replacement.