The 2011 Federal Tax Credit (Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act) has been signed into law on December 17, 2010. In this, Congress has reduced the federal tax credit for energy-efficient windows and doors and changed the qualifying criteria. Below is a summary:
Qualifying Products: All Energy Star® qualified windows and doors are eligible. Products must be installed in a consumer's existing primary residence; new construction is not eligible.
Credit Amount: Consumers can claim a credit of 10% up to $200 of the purchase price of qualifying windows and doors. Installation costs are not included.
Lifetime Cap: There is now a lifetime limit of $200 for windows in total credits that a homeowner can claim from Jan 1, 2006 to Dec. 31, 2011. It is not on top of the $1,500 limit in 2009-2010. So if you have already reached or exceeded the $200 limit, you are no longer eligible to claim the credit in 2011.
Duration: The revised tax credits is in effect for products installed in a consumer's primary residence between January 1 and December 31, 2011.
The government is expected to post additional information and www.energystar.gov. The IRS is expected to post official guidance at www.irs.gov in early 2011. Circumstances vary widely, so consumers should consult their tax adviser for future guidance.
Homeowners need to save their receipts for their windows purchased along with all window labels and stickers to apply for the tax credit.