Tax Credits for Adding or Replacing Insulation
The 2010 energy tax credit is gone, but there are still some smaller tax credits to take advantage of! Whether it’s summer heat or winter cold, insulation makes your house a lot more livable. From 2009 to 2010, the government helped out, letting you take $1,500 in tax credits for adding insulation. If you took full advantage of this credit make sure to f
ile IRS Form 5695 in 2011.
If you didn’t take advantage and you wished you had, you still have options. At the last minute, the government added a suite of less generous but still useful energy tax credits, available only to those who didn’t take advantage of the 2009-2010 program. Among these is a $500 credit for insulation. Tax credit limits and deadlines: 10% of expenditures, up to $500 for the year, for all energy improvements combined. Install the insulation by Dec. 31, 2011.Save receipts and labels for the IRS! By mid-January the Energy Star site will be posting new guidelines on what exactly is covered. It’s your safest bet for information on how to get the credit. Here is what is covered so far:
Products that reduce air leaks also qualify
Weather stripping (such as fabric, foam, or metal to provide a seal)
Spray foam in a can, designed to air seal
Caulk designed to air seal
Installation isn’t covered. What is the Cost?
Adding insulation is a relatively affordable home improvement project, and the savings can be felt almost immediately. Some DIYers can even tackle the project themselves over a weekend. Cost for adding attic insulation to a 2,200-square-foot home: $1,000 to $2,500 including labor, depending on how much you put in and how easy it is to install. Effort and expense go up when you add it to exterior walls or around hard-to-reach ductwork.