By Johnny Jackson
As winter approaches, and area homeowners see their home heating bills rise, tax officials stress there are potential savings for homeowners who make energy efficient improvements to their homes.
The amount in potential tax credits available for energy efficiency improvements and alternative energy equipment is triple the amount it was in 2008, according to Mark Green, spokesman for the Internal Revenue Service.
Green said the 2009 American Recovery and Reinvestment Act (ARRA) increased the maximum amount that can be claimed for improvements done during 2009 and 2010. The limit, once $500, is now $1,500 for improvements made in that time frame.
He said the law now provides a uniform credit of 30 percent of the cost of certain qualifying improvements, up to $1,500. Qualifying improvements include adding insulation, energy efficient exterior windows, and energy efficient heating and air-conditioning systems.
"The new expanded credits will make homes more energy efficient," Green said.
The legislation could play a role in increasing energy savings in the short term, according to Chandu Patel, the owner of Country Fireside, a Stockbridge retailer of energy efficient wood- and pellet-burning stoves.
"It is estimated that if you buy a stove, you should save enough money to pay off the stove within two or three years," Patel said. "And with the tax credit, it should be paid off much quicker."
He said energy efficient stoves average about $3,000 each and can generally heat spaces up to 2,500 square feet.
The stoves also produce fewer air pollutants than heating systems of the past, said Patel's daughter, Tina Patel, a Country Fireside sales associate. "Wood-burning fireplaces -- whether masonry or pre-fabricated and older stoves like the potbelly used 40 years ago -- can be woefully inefficient, and are known to produce very high emissions," said Tina Patel. "The latest wood-burning inserts and stoves are EPA [Environment Protection Agency] certified to produce much lower emissions ... because they are designed to re-combust the gasses released by the wood when it burns, resulting in fewer emissions left over to go up the chimney."
The ARRA also includes provisions that serve environmentally friendly purposes through alternative energy incentives -- on equipment such as solar hot water heaters and geothermal heat pumps -- and tougher energy efficiency standards.
According to Green, the IRS spokesman, the legislation increases the energy efficiency standards for home installations done after Feb. 17, 2009.
To learn which Energy Star labels and manufacturer certificates meet the newer energy efficiency standards, visit the IRS web site.
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