New Energy Tax Credit Could Stimulate Green Renovation Jobs
Beefed-up tax credits for energy-efficient home improvements in the new stimulus package are expected to help increase demand for green renovation projects this year and next.
The IRS Section 25C tax credit for existing homes, which had expired at the end of 2007, was reinstated as part of the economic rescue package passed by the Bush Administration last fall. Installing energy-efficient windows, doors, roofing and insulation as well as furnaces, air conditioners and heat pumps all qualified for the credit.
But remodeler’s found that the terms of the 25C credit – equal to only 10% of the cost of each product and with a lifetime cap of $500 – weren’t quite strong enough to get enough homeowners off the fence and into a contract. Under the stimulus legislation signed by President Obama, the percentage of the cost and lifetime cap have been tripled to 30% and $1,500, respectively; the list of eligible improvements has been expanded and the deadline for applying has been extended through the end of 2010.