Tax incentives for Boston home improvement
Remodeling different rooms in your home can be cost effective when you decide to sell your Boston homestead. However, if you plan on staying put for a while, there are some home improvements you can make that can give you more immediate gratification in the form of tax credits.
“Eco-friendly” is the key word. Many of these remodeling incentives are based on the 2009 American Recovery and Reinvestment Act, which emphasizes rebuilding the economy through green industries.
Here are a number of products that are eligible for federal tax credits under ARRA:
- Energy-efficient doors and windows: The maximum credit available for EnergyStar windows is $200. Installation costs are not eligible for the credit, and other restrictions may apply.
- Water heaters: The maximum credit is $300. Installation costs for these are eligible, though some restrictions for energy efficiency apply.
- Insulation: Whether it's spray foam, fiberglass or blow-in cellulose insulation, they’re all covered as long as they meet International Energy Conservation Code requirements. However, installation costs are not covered.
- HVAC components: These can include advanced air handlers, air force heat pumps, central A/C units, boilers, propane and gas furnaces. The limit is $300 and furnaces must be 95 percent efficient. Installation costs are eligible.
- Metal and asphalt roofs: Credits can be redeemed for up to $1,500. This credit doesn’t include installation costs.
Homeowners have through Dec. 31, 2011, to take advantage of the incentives available through federal home improvement tax credits. The improvements must be in an existing home that's the homeowner's principal residence and eligible products must be placed in service in 2011.
Homeowners may also claim tax credits up to 30 percent through 2016 for geothermal heat pumps, solar hot water systems, small residential wind systems and solar photovoltaics.
To claim the energy-efficient products tax credit, you will need to claim it when you file your taxes in 2012. Make sure you include IRS Form 5695 when you file your tax return. Though you may never need to produce them, save or make copies of your receipts and the manufacturer's certification statement in case of an audit.


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