Home Buying & Selling – Union, Morris, Essex & Somerset Counties of NJ

Home Buyers and Home-owners – TAKE NOTE:  the Federal Government is offering you a 30% tax credit for the money you spend in 2009 and 2010 when you install qualifying energy-efficient systems and products, including: furnaces, central air conditioners, water heaters, insulation, roofs, windows, doors, and skylights.  There is no upper limit on your income to get these credits, but you cannot get back more money in credits than you actually owe in taxes.  Some systems have no tax credit cap, but for most systems, the cap is $1500 in total credit.  That means for most home improvement projects (through a single or multiple purchases), you can spend up to $5,000 and get back 30% or $1500 as a tax credit.  If you get the entire $1500 credit in 2009, then you can’t get anything additional in 2010.  But in addition to the 30% tax credit for items which have a cap of $1500, you can also get another 30% credit for products which have no upper limit in tax credit.

Products with a $1500 cap:

Heating (see: http://bit.ly/cs3kTF), Ventilating and Central Air Conditioning Systems (see: http://bit.ly/cHgmGo); insulation and products that reduce air leaks; Biomass Stoves (eg. wood pellet stoves; see: http://bit.ly/ckStUh), windows, doors & skylights (see: http://bit.ly/12XR2N); Metal & Asphalt Roofs (see: http://bit.ly/akKtke), and non-solar water heaters (see: http://bit.ly/4g5KSU).  The products must be installed in a pre-existing primary residence and meet energy efficiency qualifying standards.  The tax credit for these items is for the cost of the product only and does not cover the installation/labor costs.  This tax credit expires December 31, 2010.

Products without no upper limit on tax credit:

geothermal heat pumps, small residential wind turbines and solar energy systems (including solar water heaters and solar panels).  For this credit, products must meet the qualifying standards, but  can be installed in both pre-existing and new construction qualify, as well as both primary and second homes (but rentals do NOT qualify).  If you owe less in taxes than the 30% you spend on these products, you can actually carry forward the unclaimed portion to future years through 2016.  This tax credit does not expire until December 31, 2016.

Residential Fuel Cell and Microturbine Systems- is in a category all by itself.

The systems must have an efficiency of at least 30% and a capacity of at least 0.5kW.  The tax credit is capped at up to $500 per .5 kW of power capacity, and does include the cost of installation.  Both existing homes and new construction homes qualify, but for principal residences only.  Second homes and rentals do NOT qualify.  This tax credit does not expire until December 31, 2016.

To apply for the credit, file tax form 5695 with your tax return.  Contractors should provide an itemized bill that separates out the cost of the product from the cost of the installation/labor.  Also, get a ‘Manufacturer’s Certification Statement’ for your records from the manufacturer of the products used by calling the manufacturer or searching their website (certifying that the product qualifies for the tax credit).  Please refer to your tax advisor and the following site for specifics about this program: http://bit.ly/sF5ge.

If you are looking to buy a home in Summit, Chatham, Morristown, Randolph or other nearby towns in Union, Morris, Essex and Somerset Counties, you can contact Judi Paris for advice on how these tax credits may factor into your home purchase considerations.  Judi has been awarded the National Association of REALTORS^®’ (NAR) Green Designation, the only green real estate professional designation recognized by NAR.  More specifically, Judi was trained in understanding what makes a property green, helping clients evaluate the cost/benefits of green building features and practices, distinguishing between industry rating and classification systems, listing and marketing green homes and buildings, discussing the financial grants and incentives available to homeowners, and helping consumers see a property’s green potential.

Judi Paris, Broker/Sales Associate

Coldwell Banker Realtors- Summit, NJ

(O) 908-522-3631  (C) 973-902-HOME

Visit me at:     www.BestHomeResults.com

Follow me on Twitter:     @JudiParis