There is only this weekend before income tax returns are due, and we have spent this week discussing some simple tax tips. So far, we have looked at the tax advantages of home ownership and offered a few ways to plan for retirement.
Back in January, we discussed how making a few simple choices around the house can help the environment while saving you money on a weekly and monthly basis. Those recommendations included choosing ENERGY STAR-qualified products when replacing light bulbs, and upgrading to an ENERGY STAR-qualified programmable thermostat.
Today, let’s look at how making your home more energy-efficient can impact your income taxes.
If you visit the ENERGY STAR website, they have a central location that outlines some of the great opportunities for energy-efficient upgrades providing federal tax credits.
Sometimes, routine maintenance uncovers easily fixed problems with air conditioning units or heaters. Unfortunately, there are also times that those units need to be replaced. If you have replaced any significant appliances or improved your home’s energy efficiency by replacing windows and/or doors, you could save money on your taxes.
As is pointed out on the site, not all ENERGY STAR products qualify for a tax credit. But many significant expenses can be a benefit to you, whether those replacements (or upgrades) took place last year or are on your To Do List for 2013. Take a look at the great breakdown of tax benefits on the ENERGY STAR site.
If you made improvements last year, and want to include them in your tax return, you’ll need to use Form 5695 to itemize those deductions.
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