The IRS recently posted a reminder to homeowners that there is still time this year to make energy-saving and green-energy home improvements and qualify for credit.The first of these credits, termed “The Nonbusiness Energy Property Credit”, is aimed at homeowners who install energy-efficient improvements such as insulation, windows, and furnaces. The credit is more limited than in the past years, but can still provide substantial tax savings. The following is a summary of this 2011 credit:- Credit rate is 10% of the cost of qualified energy efficiency improvements, which include adding insulation, energy-efficient exterior windows and doors, and certain roofs. – Credit can be claimed for the cost of residential energy property, including labor costs for installation (includes certain high-efficiency heating and air conditioning systems, water heaters, and stoves that burn biomass fuel).- Credit has a lifetime limit of $500 (of which only $200 may be used for windows). If the total of non-business energy property credits taken in prior years since 2005 is more than $500, the credit may not be claimed in 2011.- Qualifying improvements must be placed into service to the taxpayer’s principal residence located in the United States before January 1, 2012.The second credit, termed “Residential Energy Efficient Property Credit,” is designed to spur investment in alternative energy equipment. The following is a summary of this 2011 credit:- Credit equals 30% of what a homeowner spends on qualifying property, such as solar electric systems, solar hot water heaters, geothermal heat pumps, wind turbines, and fuel cell property.- No cap exists on the amount of credit available (except for fuel cell property).- Labor costs are typically included when figuring this credit.Not all energy-efficient improvements qualify for these tax credits. Homeowners should check the manufacturer’s tax credit certification statement before they purchase. For more information on Home Energy Credits for 2011, contact our office.