Sunday, December 14, 2008

Do You Qualify For An Energy Credit?

You may be able to take these credits if you made
energy saving improvements to your home located in the United States in 2007. For credit purposes, costs are treated as being paid when the original installation of the item is completed, or in the case of costs connected with the construction or reconstruction of your home, when your original use of the constructed or reconstructed home begins. If less than 80% of the
use of an item is for nonbusiness purposes, only that portion of the costs that are allocable to the
nonbusiness use can be used to determine the credit.
Home. A home is where you lived in 2007 and may include a house, houseboat, mobile home, cooperative apartment, condominium, and a manufactured home that conforms to Federal Manufactured Home Construction and Safety Standards.You must reduce the basis of your home by the amount of any credits allowed.

Main home. Your main home is generally the home where you live most of the time. A temporary absence due to special circumstances, such as illness,education, business, military service, or vacation, will not change your main home.
Special rules. If you are a member of a condominium management association for a condominium you own or a tenant-stockholder in a cooperative housing corporation, you are treated as having paid your proportionate share of any costs of such association or corporation.
Subsidized energy financing. Any amounts provided for by subsidized energy financing cannot be used to figure the credits. This is financing provided under a federal, state, or local program, the principal purpose of which is to provide subsidized financing for projects designed to conserve or produce energy.
Nonbusiness Energy Property Credit
You may be able to take a credit equal to the sum of:
1. 10% of the amount paid or incurred for qualified
energy efficiency improvements installed during 2007,
2. Any residential energy property costs paid or
incurred in 2007.
c A total combined credit limit of $500 for all tax years
after 2005.
Qualified energy efficiency improvements. Qualified energy efficiency improvements are the following building envelope components installed on or in your main home that you owned during 2007 located in the United States if these components are new and can be expected to remain in use for at least 5 years. c Any insulation material or system that is specifically and primarily designed to reduce the heat loss or gain of a home when installed in or on such home.

a. Exterior windows (including certain storm windows
and skylights).
b. Any metal roof installed on a home, but only if this roof has appropriate pigmented coatings that are specifically and primarily designed to reduce the heat gain of the home. For purposes of figuring the credit, do not include amounts paid for the onsite preparation, assembly, or
original installation of the property.
c. A combined credit limit of $200 for windows for all
tax years after 2005.

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