Looking For End Of Year Tax Savings?

Energy Efficiency Home Improvements Can Pay Big

 

Alexandria, VA (October 30, 2006) – As the end of the year approaches, many Americans are looking for last minute deductions and shelters to avoid big tax bills. Why not take advantage of a tax break that pays you at tax time and keeps paying you every month? In 2005, Congress passed the Energy Policy Act, which provides homeowners a tax credit of up to $500 for improving the energy efficiency of their homes in 2006 and 2007.  Improving the energy efficiency of a home pays at tax time and continues putting money back in homeowners pockets every month by lowering energy bills*.  

The tax credit is in effect for improvements made between January 1, 2006 through December 31, 2007. The North American Insulation Manufacturers Association (NAIMA) reminds homeowners that adding insulation to their homes is one of the easiest ways to save money on their utility bills and qualify for the tax credit. Improved levels of insulation also improve comfort and make other energy efficiency improvements like more efficient furnaces pay off faster.

“Encouraging consumers to improve the energy efficiency of their homes not only helps the environment, but through 2007, it also directly benefits those homeowners who take advantage of the tax credits,” said Ken Mentzer, president and CEO of NAIMA.  “Adding fiber glass or mineral wool insulation is one of the easiest and most effective ways for a homeowner to qualify for the tax credit.” 

NAIMA advises that most homeowners will need to add between an R-19 and R-30 insulation to their attics in order to qualify for the tax credit and increase their comfort and savings.  Consumers should also consider adding insulation to their unfinished basements and crawlspaces since these areas are easy to access and are often under-insulated or not insulated at all.

The tax credit for existing homes is for 10 percent of the final cost of qualified home improvement products for a maximum of $500 over 2006 and 2007.  Consumers should keep their receipts when they purchase the insulation and other energy efficient products that qualify for the tax credit.  Consumers also need a certification statement from the insulation manufacturer for their records stating that the insulation product they installed qualifies for the tax credit. Consumers should consult IRS guidelines for full details on how to qualify for the tax credits.

At NAIMA’s website, www.SimplyInsulate.com, homeowners can find helpful tips and free literature on how to add insulation to a home and what to look for when hiring an insulation contractor: The site also offers additional information on the Energy Policy Act tax credit such as how much insulation you need to qualify, links to manufacturers’ certification statements, and information on other rebates and incentives for installing additional insulation in your home

* Savings vary. Find out more in the seller’s fact sheet on R-values. Higher R-values mean greater insulating power.