 | Click here to see a printable copy of the Wallside Windows Manufacturer's Certificate for the Tax Credit.
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The American Recovery & Reinvestment Act of 2009 — commonly known as the stimulus package — was signed into law by President Obama on February 17, 2009. It allows homeowners to receive an energy tax credit of 30% of the amount paid for an eligible product up to a maximum of $1,500 for all qualifying improvements in 2009 and 2010.
To qualify for the tax credit, windows and doorwalls must provide energy efficiency in two ways:
Heat Loss — which means how well products prevent heat from escaping a home. The measurement for heat loss is called U-Factor.
Heat Gain — which means how well a window blocks heat from the sun. The measurement for heat gain is called Solar Heat Gain Coefficient (SHGC).
For both the U-Factor and the SHGC, the rating must be 0.30 or lower to qualify for the new tax credit. Not all Energy Star products are eligible for a tax credit.
What is a Tax Credit?
A tax credit is an amount you can subtract from the tax you would otherwise owe. Unlike a deduction or exemption, a credit is a dollar-for-dollar reduction of your tax bill. The benefit comes in the form of a direct reduction in the amount of income taxes you might owe by the amount of the credit you receive. You claim the tax credit on your federal income tax form at the end of the year.
What is the Difference Between a Tax Credit and a Tax Deduction?
A tax credit is more beneficial to the taxpayer than an itemized deduction because it reduces taxes on a dollar-for-dollar basis.
How Do I Get My Tax Credit?
1. Windows purchased must be equal to or below a U-Factor of 0.30 and a Solar Heat Gain Coefficient (SHGC) of 0.30.
2. The credit is allowed only on the price of the eligible windows and doorwalls. The cost of installation cannot be included in the credit. We attribute 20% of the total cost of our windows to installation.
3. The tax credit applies for eligible windows and doorwalls installed by December 31, 2010
4. The tax credit applies only to a customer’s primary residence. That means windows and doorwalls purchased for investment properties, second homes, etc. are not eligible to receive the tax credit.
5. To claim the credit, consumers must have a Manufacturer’s Certification Statement (which may be in a printable form on the manufacturer’s website) and should have their receipts. Improvements made in 2009 may be claimed on 2009 taxes with IRS Form 5695 (2009) version which should be available in late 2009 or early 2010.
The foregoing is merely a summary of Wallside's understanding of certain tax matters, and is not intended to be, and should not be construed as, legal or tax advice. Purchasers are urged to consult with their own professional tax advisors regarding these matters. Wallside does not warrant that any purchaser will qualify, and will not be responsible for any purchaser's inability (for any reason) to qualify, for any tax credit or benefit of any kind.
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