Green Home Improvements: Take Advantage of Tax Credits for Energy-Saving Home Improvements

Green home improvements have been encouraged in recent years through the offering of tax incentives. For people interested in making their homes more energy efficient and gaining the tax benefits at the same time, here are some tips to help you understand what types of green home improvements qualify for a tax credit and how to make sure you don’t miss out on the opportunity to earn your benefit.

Some green home tax credits are expiring at the end of 2010. Although we are approaching year-end, there is still time to take advantage of some of these money-saving incentives for energy-saving home improvements, but you must hurry.

Tax credits are offered on a wide range of green home improvements and upgrades. Some are very inexpensive to do; other can be quite costly even with the tax credit. Here is a summary of what is available for 2010.

The simplest and least expensive energy-saving home improvement that qualifies is adding insulation. Insulation for your attic can be purchased for no more than $50 to $100, and if you install it yourself (which is fairly easy and straightforward to do) there is no additional cost. This will earn you a tax credit of 30% of the cost.

For more expensive investments, tax credits of 30% of the cost, up to a maximum credit of $1500, are available now for the purchase and installation energy efficient furnaces and air conditioning units, energy efficient windows and doors, and water heaters. The credit includes the cost of materials and also the cost of installation for all these items except for the installation on doors and windows (don’t ask me why windows and doors are excluded; it makes no sense, but that is the law).

It is important to remember that these tax credits apply only to your primary residence. Second homes and rental homes and apartments do not qualify for the items listed above.

But I have saved the best part for last. There are even better tax benefits available for rooftop solar panel arrays, small residential wind turbines, and geothermal heat pump systems. For these specific green home improvements, the tax credit covers 30% of all costs, including installation without any upper limit. Even better, for these specific energy-saving investments the tax benefits can be claimed for your primary residence and second homes. Unlike the previous cases, new constructions are also okay. And get this: these government-provided subsidies are not expiring at the end of 2010. Tax credits for solar panels, wind turbines, and geothermal heat pumps are available through the year 2016.

Brits Shown to Favor Green Home Improvements

Eco-friendly home improvements appear to be increasingly sought-after by Britons, it has been reported.

In research carried out by Legal & General as a part of its ongoing Changing Face of British Homes study, it was revealed that making greener changes to lifestyles is an evermore popular option for members of the public. The study showed that some 37 per cent of people have installed either draught-proofing or double glazing. Meanwhile, 25 per cent of respondents were shown to have fitted additional loft insulation.

For those consumers looking for an effective way to carry out eco-friendly improvements to their property, such as double-glazing and loft insulation, taking out a low-cost home loan may be useful.

The study also showed that just under three-quarters of Britons use low-energy light bulbs, with 23 per cent of respondents looking to recycle rain water. Making sure electrical appliances are not left on standby and making use of reusable shopping bags were also revealed to be popular eco-friendly lifestyle changes. Meanwhile, recycling rubbish was indicated as the most sought-after means in which people lead a greener lifestyle. Overall, 98 per cent of people claimed to be taking steps to improve their environmental efficiency.

However, it appears a significant number of Britons only want to make environmentally-friendly changes when it suits them, with more than half of those questioned said to be unhappy about being charged for waste removal services. An estimated 23 per cent are said to be irked at having to pay for plastic carrier bags at supermarkets and shops.

Commenting on the figures, Ruth Wilkins, head of communications for Legal & General’s general insurance business, said: “While people are annoyed by the implementation of green initiatives the efforts being made to force residents to recycle more of their rubbish are beginning to pay off, with recycling rates jumping from seven per cent to 33 per cent in the past ten years. Legal & General’s recent research would support these findings as the Changing Face of British Homes research shows that a large number of us are taking steps to become greener. Brits simply want to make their own decisions regarding how and when to be green.”

Ms Wilkins went on to report that it is important for those homeowners thinking about carrying out major improvements to their property which are of an environmentally-friendly nature “to check their insurance cover to make sure they are covered under the terms of their policy”.

For consumers wishing to renovate their house – and at the same time help take steps to save the environment – applying for a homeowner loan could be useful. In obtaining this kind of home loan it may be possible that the cost of installing eco-friendly improvements – such as cavity wall insulation, biomass heaters, draught proofing and solar heating panels – can be met quickly and affordably. Indeed borrowing for the purposes of financing home improvements could be rising in popularity after a recent Lloyds TSB study revealed a 19 per cent increase in loan applications for such purposes this month in comparison to August 2007.

Green Home Improvement Tips

These days, everyone wants to do their part to help the environment and cut down on waste. There are many obvious ways to do this, such as recycling or buying a hybrid car. There are other less obvious ways that can make a big impact. One of the best ways to conserve energy and, as a result, save money in the long run, is by doing a green home renovation. While this may seem like a daunting undertaking, with the right planning, it can be a relatively stress-free project that results in both measurable and non-measurable benefits.

To begin with, it is important to have a plan. Green home improvement differs from basic home repair because you are working toward an ultimate goal of making your home more efficient and environmentally friendly. It is advisable to work with a green contractor who has experience with this specific kind of renovation. The contractor can help you decide if you may need a drastic overhaul to achieve optimal conservation, or if a few small changes will suffice. A simple step towards going green is switching to energy-efficient light bulbs and installing motion detectors and timers that keep lights off when they are not needed.

A more involved way of making a home eco-friendly is by installing a new HVAC system (heating, ventilation and air conditioning). Your contractor can help you install a system that optimizes the space you have, with the most efficient use of energy. When installing a new HVAC system, it is important to keep in mind the climate that you live and the needs of your home.

It is also advisable to think green when selecting the products that you will use in your renovation. Not all materials are created equal, as many contain products that are harmful to the environment. Try to stick to products that are long-lasting, and contain recycled material that is eco-friendly. Also, by selecting products that are durable, you avoid having to replace them, and as such, are able to cut down on waste. Many green products can be found in home improvement stores, so be sure to some research before committing to a brand.

Window replacement is another way to conserve energy and cut down on costs. By installing windows with better insulation, you are reducing the amount of heat or air-conditioning that is wasted and your home is better able to heat or cool itself using natural resources. This is a significant way to reduce energy bills, since your home is more efficient and requires less energy to maintain.

Lastly, it is important to remember that maintaining a green home is an ongoing commitment. Be conscious of using eco-friendly cleaning products and other materials. Make sure to keep water use to a minimum, and always turn off electronics and appliances when not in use. While it is difficult to change old habits, it is vital that we all do our best to conserve resources and help our environment.