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Can energy efficient windows be claimed on taxes?

Can I claim energy efficient windows on my taxes?

If you’ve made a purchase of energy efficient windows or doors from DunRite in 2020, you may be eligible to claim that purchase on your taxes, receiving a tax credit up to $500.

However, certain criteria apply.

The Residential Energy Property Credit

The end of 2020 is approaching quickly and unless there is a last minute (or retroactive) extension of the program, December marks the end of the residential energy property credit for homeowners – a tax credit incentive of up to 10% of the cost of energy efficient exterior windows and/or doors.

As of April 2021, we still haven’t heard if this will be extended. We’re assuming the IRS is too busy dealing with coronavirus tax changes to circle around to this, but we’ll let you know as soon as we hear something!

If you’ve had windows or exterior doors installed by DunRite Windows & Doors this year, then you may qualify for the credit. Keep that receipt on hand when you are ready to file.

What are the details of the windows tax credit?

Energy efficient windows and doors fall under the Residential Energy Property Credit program for homeowners. Applying only to primary residences, the program gives back 10% of the product purchase cost of qualifying windows and doors installed by December 31, 2020, for up to $2,000 of your purchase.

This $200 tax credit for energy efficient windows counts toward a maximum $500 tax credit limit for the program overall, which also includes rebates for other energy efficient upgrades to a home, such as insulation, ceiling fans, heating and air conditioning systems, hot water heaters and solar equipment.

If you’ve already claimed the $500 maximum before the windows purchase—say for installation of solar panels on your roof or last year’s AC unit—then you won’t be eligible for additional tax credits from your DunRite purchase.

What products qualify?

Since the tax credit is an incentive for homeowners to become more energy efficient, product must meet or exceed the Energy Star 6.0 program requirements to qualify for the tax credit.

Most products installed by DunRite are Energy Star certified, but you can ask us for confirmation, or look up your specific product on the manufacturer’s website to verify.

Installation of a qualifying product can be a replacement window or door, or installation where there wasn’t one before, such as for a newly created wall opening or home addition. Big sliding glass doors and moving wall systems qualify, as long as the product installed can meet the Energy Star requirement.

All qualifying products must be installed on the exterior of the home, so interior doors do not qualify.

Does installation have to be completed in 2020?

Any qualifying products must be purchased (or financed) and installed before the end of the year to apply for the credit. The program expires at the end of the year, although it does have a history of being extended. If your installation rolls forward into 2021, don’t give up hope until it’s actually time to file. The credit may still apply. Check EnergyStar.gov or the IRS website for details.

How to I claim the credit?

When filing your taxes, use IRS IRS Form 5695 to calculate and claim the credit. You’ll need the size of each window and/or door installed to calculate square footage, and a copy of your purchase receipt from DunRite.

Can I apply this tax credit to a second home?

To qualify for this tax credit, installation must be done at the homeowner’s primary residence before the end of the year. Second homes aren’t eligible; neither are new construction or rental properties.

Are there other credits or rebates my purchase may be eligible for?

This is the only tax credit program we’re aware of; however, utility companies often offer rebates. You’ll want to check any that apply to your service area. In Arizona, these include APS, SRP and Southwest Gas.

Currently, Southwest Gas is offering a rebate in 2020 for their customers. It pays $1.00 per square foot of window or door product, up to 75% of the equipment costs. Click here for details or to apply.

Currently, APS and SRP do not offer any rebates for energy efficient windows or doors. We did find one resource that might be useful to bookmark, though, called the Energy Star Rebate Finder. It allows you to search for Energy Star rebates by zip code, including windows/doors and other products.

We hope this information is helpful! If you have questions, don’t hesitate to reach out to us on Facebook.


   
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DunRite Windows & Doors is an authorized dealer for most brands of AZ window replacements and doors, including Andersen®, Pella®, Anlin™, Thermatru®, Masonite® and others. We serve Phoenix, Mesa, Scottsdale and other cities around the Valley.