May 7, 2012

Personal (Nonbusiness) Energy Property Credit


Taxpayers can claim a credit for certain home improvements placed in service in 2011.  This credit for personal energy property was also available for qualifying improvements placed in service from 2006-2010, except for 2008.

Allowable Credit:
The credit is equal to 10% of the cost of qualified energy-efficient property or improvements.
The credit is limited to (1) $50 for each advance main air circulating fan; (2) $150 for each natural gas, propane or oil furnace or hot water boiler and (3) $300 for each item of: (a) electric heat pump water heaters, (b) electric heat pumps, (c) biomass fuel stoves, (d) high-efficiency central air conditioners or € natural gas, propane or oil water heaters.

The total amount of credit than can be claimed in 2011 combined is $500 ($200 for exterior windows and skylights).  This amount is reduced (but not below zero) for any credits claimed in 2006-2010.
There are no AGI or income limits so all individuals can claim the credit.

For 2011, the credit can offset regular tax and AMT.

The credit is reported on Part I of Form 5696, Residential Energy Credits.

Personal Energy Property Credit - Qualifying Property 2011
Product Energy Requirements Maximum Credit
 Per Item
Advanced Main
Air Circulating Fan
Must use no more than 2% of the furnace's total energy  $50.00
Air Source Heat Pump
1)Split systems: HSPF ≥ 8.5; EER ≥ 12.5; SEER ≥ 15.
 $300.00
2)Package systems: HSPF ≥ 8; EER ≥ 12; SEER ≥ 14.  $300.00
Biomass Stove
Thermal efficiency rating of at least 75% as measured 
 $300.00
using a lower heating value.  

Central Air Conditioning

1)Split systems: EER ≥ 13; SEER ≥ 16.
 $300.00
2)Package systems: EER ≥ 12; SEER ≥ 14.
Electric Heat Pump Water Heater
Energy factor ≥ 2.0. All ENERGY STAR qualified electric 
 $300.00
heat pump water heaters qualify.

Gas, Oil or Propane Hot Water Boiler
AFUE ≥ 95  $150.00
Gas, Oil or Propane Water Heater
Energy factor ≥.82 or a thermal efficiency of at least 90% 
 $300.00
Insulation
Must meet 2009 IECC (including supplements) prescriptive
 $500.00
criteria.To qualify, its primary purpose must be to 
insulate.Therefore, insulated siding does not qualify.

Natural Gas or Propane Furnace

AFUE ≥ 95

$150.00

Oil Furnace

AFUE ≥ 95

$150.00

Roof(Metal & Asphalt)

Metal roofs with appropriate pigmented coatings & 

$500.00
asphalt roofs with appropriate cooling granules that also
meet ENERGY STAR requirements.

Storm Windows & Doors

In combination with the exterior window/door over 

$500.00
which it is installed: has a U-factor and SHGC of .30 or
below and meets the IECC prescriptive criteria.

Windows & Skylights
U factor ≤ .30; SHGC ≤ .30  $200.00
Source: www.energystar.gov
Thomson Reuters

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