Is it still possible to claim your home’s window replacement project cost as a tax credit in the United States?
In short, the answer is no. The National Energy Property Tax Credit Program expired on December 31, 2017.
However, you should also double check this information as this blog post may be outdated.
How Much Tax Credit Can You Get For Home Replacement Windows?
If you did a window improvement project before December 31, 2017, then the credit was 10% for the window cost up to a certain limit. Keep in mind this does not include the cost of installation and other needed materials.
What Form Do You Need For Window Replacement Tax Credits?
You will need to file the IRS Form 5695 (PDF) with your 2017 taxes to receive credits for your project.
What Qualifies For Home Improvement Energy Tax Credits?
Anything that boosted the energy performance of your home qualified for tax credits. This includes windows, doors, and skylights.
In 2017 or 2018, you may have made the wise decision to get your windows replaced. You may have chosen this avenue because your windows were old or unappealing, making the job purely cosmetic. Perhaps you wanted a window replacement to save money on your energy bill.
Regardless of your reasons, now that tax time has come around for the 2018 season, you’re curious if you can get a deduction on your window replacement. If this is a question that you have asked yourself, then you don’t want to miss this article.
Can You Claim a Window Replacement on Taxes?
Tax deductions exist left and right, and so you pay a little less at tax time. Whether these deductions are tied to your job or personal home renovations like new windows, they’re one reason (sometimes the only reason) to put a smile on your face this time of year.
If you replaced your windows in 2017 and want to claim them for the 2018 tax season, you more than likely can. We say more than likely because there are limits and conditions on what kinds of windows you can claim.
Which Windows Are Eligible for 2018 Tax Deductions?
That said, you don’t have to have replaced your windows in full to potentially enjoy a tax credit.
The replacement windows must meet the standards put forth by Energy Star. Per Energy Star’s website, those standards are:
Your windows must pass US Environmental Protection Agency or EPA energy efficiency guidelines, having earned a good rating from the National Fenestration Rating Council or NFRC
The NFRC must have “independently tested, certified, and verified” the quality of the windows.
The windows must be manufactured through an Energy Star partner if not Energy Star themselves
Here are the NFRC guidelines. The illustration is courtesy of Energy Star:
How Much Money Can You Expect to Get?
If your windows are eligible to be claimed on your 2018 taxes, you’re of course going to want to know how much money you’re going to get for them.
The credit will not be over $200. For the full cost of the windows, the credit is supposed to be roughly 10 percent of your expenses or less.
How Do You Claim Your Windows on Your 2018 Taxes?
While you may have been hoping to get more money deducted for your window expenses, free money is free money. You’re not going to pass up on claiming your windows on your 2018 taxes, but how exactly do you do it?
You’ll have to download Form 5695, which is the Residential Energy Credits form. You can find it to download on the IRS’s website here.
Once you download the form, print it out and complete it.
You will have to have such information handy as your costs for your qualified geothermal heat pump, your qualified small wind energy property, your qualified solar water heating property, and your qualified solar electric property.
You’ll also have to be privy to your qualified fuel cell property costs, kilowatt capacity, and any 2017 carryforward credits.
If you’re struggling to fill out this form, we recommend you contact the window installation company.
You can also reach out to your dedicated tax person and ask for their assistance. Once the Form 5695 is completed, bring it with you when you go to file your taxes. If you file online, you’ll want a digital copy of the form at the ready.
After your taxes are processed, you should soon see the credit as part of your tax refund.
Other Deductions You May Be Interested In
You may have decided to deduct your window replacement for your 2018 taxes, but don’t stop there! If you did other home improvements in 2017, then chances are, most of these are deductible as well.
Let’s delve a little more into these other deductions.
If you live in Minnesota and you got new vinyl installed in 2017, you can get a tax deduction for the 2018 tax year.
This will only be for the cost of the vinyl siding sales tax. If you live in any other state, it does not appear you can get the sales tax deducted.
You will need to have held onto all receipts for your vinyl siding work to be eligible for this tax deduction. To apply it, put the costs of the sales tax on the income tax return for 2018.
Whether you got vinyl siding replacement or a new installation done, you can shave a bit of the money off the total cost of your vinyl siding sales tax.
Vinyl siding itself does not count as an energy tax credit. Only sales tax deductions are allowable.
On the other hand, door replacements do count as energy tax credits. There’s no state limit on these credits, either.
You could have had a partial or full replacement on your doors to be eligible for this 2018 tax credit.
Doors that count include interior doors, garage doors, and entry doors.
All doors must pass the standards established by Energy Star. Here’s a diagram of those standards from the Energy Star website:
If your doors meet the criteria, then it’s possible to shave 10 percent off the total cost of your doors with a cap of $500.
To apply for a door replacement tax deduction, make sure you fill out Form 5695.
Residential Renewable Energy Tax Credit
There’s also the Residential Renewable Energy Tax Credit, which covers fuel-cell, geothermal, wind, and solar technologies.
Those technologies include geothermal heat pumps, wind turbines, solar-powered water heaters, and/or solar panels.
There are rules around the tax credit, which are as follows:
If you’re trying to claim deductions on fuel cells, they must use hydrogen or another renewable resource as their main power source.
Geothermal heat pumps must pass the federal standards from Energy Star.
Wind turbines must produce a base electricity limit, at least 100 kilowatts.
If you have a solar-powered water heater, it cannot just be used for your hot tub or swimming pool.
In fact, water heaters intended for those purposes are not eligible for a tax deduction. Instead, the water heater should be in the home and be primarily solar (half or more of the heat capacity).
The same goes for solar panels. This heat should be for indoor home purposes, nothing else.
If your 2017 home renovation project fits the above criteria, you could see a deduction worth 30 percent of your installation and other costs. If you have fuel cells, more money back is possible. Per kilowatt, you could get $1,000 back, and per half-kilowatt, $500. It’s possible to get a tax credit up to $5,000.
Tax time is upon us. If you’re eagerly looking for deductions so you get a decent tax refund, have you considered your windows? Most of the time, it’s possible to get some money back on replacement windows.
Make sure you check out the criteria in this article and then fill out Form 5695.
Other home improvements, such as vinyl siding (Minnesotans only) and door replacements may also apply.
If you have fuel-cell, geothermal, wind, and solar technologies, you could be eligible for the Residential Renewable Energy Tax Credit.
There are plenty of ways for you to see a pretty fat tax refund this year, and all for the money, you’ve already spent on a beautiful home.
Do you need window replacement in Winnetka, IL? . Call us today.