2009 Tax Credit for Energy Star Energy-Efficient Windows

Our home is half a block from the beach, which is wonderful in many ways, but can be a maintenance nightmare. Anything with the least amount of metal in it rusts and corrodes. The original windows started leaking and were hard to open and close. Some won't open at all. It's time to replace them.

Getting Quotes

To be sure you're getting the best price, it's important to get quotes from several places. Compare and put up with the salesman's presentation and you may find it was well worth it.

Qualitex was the first to come out and give us a quote on our 27 windows and one set of French doors. Even after making a deal to be part of their media and advertising program, which cut off 45% off the total price of nearly $55,000, we nearly broke a window and slit our wrists when we saw the price. A few bucks short of $30,000! Are they kidding? We'd have to sell the house to pay for the new windows!

The next quote was more reasonable and without a deal to bring locals by to look at the wonderful job they'd done. Quality Windows and Doors gave us a quote with the same energy efficient windows that would allow us to claim the 2009 Residential Energy Credit on our taxes when we file them in 2010. Their quote was about $13,000, a whopping $42,000 less than Qualitex's non-discounted quote. I was tempted to go with it, but we are having one more quote from a commercial window installer who does office buildings rather than homes. He's told us his price could be as low as $10,000. I'm willing to sit through one more presentation to save $3,000.

Make sure everyone's on the same page

Write a list of what you want from your new window installation so you won't forget to have it included in the quote. If it's not on the quote and final contract, there's not much chance those verbal guarantees will be honored. Double check that what's important to you isn't overlooked on the paperwork.

We never want to replace our windows again, so we are asking for a lifetime replacement guarantee on the double-pane vinyl frame windows, plus a guarantee that the company will come back and fix any leaks. Of course, lifetime guarantee only works for as long as the company stays in business. In this economy, that's something to keep in mind. The companies we chose for quotes have been in business for over 30 years. The window brand has also been a top seller for over 30 years. With this much money involved, I'm doing my homework and not relying on the salesman's pitch.

2009 Residential Energy Credit

Of course, we want the $1,500 tax credit, too. The salesmen both assured us that the windows are the Energy Star, energy efficient windows that are approved by the government in order to claim the tax credit. The dollar amount spent must be at least $5,000, so we fulfilled both the expenditure and the energy efficient window requirements.

We checked with our accountant to make sure we were getting the proper paperwork when the time came. The tax return for 2009 will reflect the tax credit of $1,500, meaning $1,500 will be deducted from the taxes we owe. We don't need to send in proof that we bought the energy efficient windows, but the contract and the Energy Star stickers off the windows must be kept with our tax records for the next 7 years in case we are audited. The guys installing the windows will take the special Energy Star stickers off the windows as they're installed and make a nice little collection for us, or so we were told. Without these Energy Star stickers, which match the information on the contract and invoice, there is no proof that we fulfilled the 2009 Residential Energy Credit requirements.

Benefits of energy efficient windows

Two of our rooms already have energy efficient windows, so we know the benefit we will get from replacing all the windows and glass doors in the house. When we turn on the heater, those two rooms are like ovens, while the rest of the house is barely warm.

Energy efficient windows will slow the movement of heat and cold through the double panes by as much as 2 degrees in 6 1/2 hours. The windows we currently have in the house allow the same 2 degree change to happen in just 6 minutes. We only use the heater about 4-6 weeks total during the year, but if we are able to heat the house more efficiently we will realize a substantial savings on our energy bills during those times.

Energy efficient windows also keep the heat out. Windows that let the light in, will also let in heat. If you're trying to keep the air conditioning costs to a minimum, energy efficient windows will save you a bundle by keeping the cool air in and the summer sun out. We don't have air conditioning at the beach, so keeping the house cool during the summer, without closing all the shutters and curtains, is important to us.

Energy Star windows have a special coating on them that's like sunscreen, so any light that filters through won't fade what's on the inside, like furniture, hardwood floors or rugs.

IRS Instructions for the 2009 Nonbusiness energy property credit

This credit, which expired after 2007, has been reinstated. You may be able to claim a nonbusiness energy property credit of 30% of the cost of certain energy-efficient property or improvements you placed in service in 2009. This property can include high-efficiency heat pumps, air conditioners, and water heaters. It also may include energy-efficient windows, doors, insulation materials, and certain roofs. The credit has been expanded to include certain asphalt roofs and stoves that burn biomass fuel.

Limitation. The total amount of credit you can claim in 2009 and 2010 is limited to $1,500.

Tax credit for joint owners of a property

If you have invested in a property with someone, you would be eligible for the $1,500 energy tax credit if it is your place of residence. Even if it is not your "primary residence", if it could be considered a "vacation home", it would qualify. Both names on the title would be eligible for the tax credit if both meet the 2009 Residential Energy Tax Credit requirements of energy efficient windows that are approved by the government and an expenditure of at least $5,000 each.

Disclaimer

I am not a tax accountant or expert on 2009 Energy Tax Credits. This information is what I've received from my personal accountant and from the businesses who are familiar with the tax credit requirements in order to install government approved energy efficient windows for their customers. Please check with your tax accountant before making any decisions based on information in this article.