Take Advantage of the Extended Energy Tax Credits
As you know, at the end of 2012 our Nation averted falling off what was referred to as the “fiscal cliff” by passing last minute budget legislation. Homeowners and homebuilders became the winners with that vote because one of the provisions was to extend the Energy Tax Credit which was designed to help them upgrade the efficiency of the building envelop and reduce their energy usage.
There were two key components of that action. Congress extended a tax credit for energy efficient retrofits through Dec. 31, 2013 and retroactively to Jan. 1, 2012. The credit allows homeowners to claim 10 percent of the cost of qualified energy-efficient building materials, such as insulation, up to $500. They also revived a business tax credit of up to $2,000.00 for builders that construct or significantly renovate “dwelling units” (e.g. apartments, condos or single-family homes) that meet certain energy efficiency standards.
I strongly recommend that to make the best decisions for improving the energy efficiency of an existing home that you conduct a home energy audit. This is an important first step in identifying where updates are most needed and how to get the greatest return from a renovation budget. ResNet is a great resource that helps connect homeowners with trained auditors in their community. For more information, visit www.resnet.us.
That being said, it is fairly easy to identify one of the greatest sources of energy loss even if you are not handy with energy modeling programs – the attic. Take a look up there. If the tops of the ceiling joists are visible then you will definitely need to add more insulation to reach the current recommended R-value. This is typical of homes built more than 30 years ago.
According to the U.S. Department of Energy, the average homeowner can save as much as 30 percent on energy bills related to comfort simply by having the right amount of insulation throughout the home. For attics, applying a premium fiberglass blowing insulation is the best solution for adding thermal performance in an attic and in keeping a home warmer in the winter and cooler during the summer (without concern for compressing what insulation already exists – a real issue with some other types of loose-fill insulations available). And the best part: it is easy to access and an inexpensive way to achieve great results year round.
There are tools available for homeowners that help recommend R-values for different areas of the home, provide estimates of potential savings, and identifies incentives for completing insulation projects from this federal tax credit down to local utility programs.
The most important thing is that you act now and don’t miss the opportunity to take advantage of the Tax Credits while you can. This might really be your last chance for a bite of the apple. The reality is older homes will need to be upgraded to remain competitive is the marketplace as newer construction comes online. It is only a matter of time before energy efficiency labels will be placed on buildings. Don’t let your single most valuable investment fall behind!