Glass shops going green: Energy Efficient Windows Can Help Cut Tax Bills
Recent federal tax credits for energy-efficient home improvements allow homeowners to cut their tax bill by up to $1500 a year for purchasing qualifying windows and replacement insulating glass. (Sorry guys, no auto glass replacement products qualify.)
To help your customers take advantage of this tax break, you just need to know what products qualify, explain that to your customer, and provide some after-sales support to make sure they can take full advantage of the tax credit.
When is the tax credit available?
Now, through the end of 2010.
How much is available?
The credit reduced the amount of taxable income calculated on the homeowner's tax return. It provides a tax credit of up to 30% of the purchase price of qualifying products. Installation costs do not qualify for the tax credit. The tax credit is capped at $1,500.
Do my windows qualify?
Not all Energy Star-rated windows qualify for the tax credit.
Only windows with a u-factor and solar heat gain coefficient at or below.30 qualify. The federal government only recognizes ratings by the National Fenestration Rating Council (NRFC) to determine the performance value of any windows, doors or skylights. The values on your products can be found on the NRFC label.
Your window vendors and suppliers will have this information. Ask them for literature to help outline the process for your replacement window customer.
What do I need to do?
Know your product. Know what windows you handle that qualify for the credit and why. Let your customers know you have the expertise, glass tools and glass equipment to provide them with a quality installation. After all know one knows the ins and outs of their glass windows better than you. You are the expert.
Make sure your sales estimates clearly indicate which products are eligible for the credit.
Make sure your invoices clearly itemize the costs of those products separate from the installation costs. To increase the amount of the purchase that qualifies for the tax credit, some glass companies charge list price for the windows and offer free installation.
Save the NFRC labels of each qualifying window so you can verify it later. Get a manufacturers certification statement from the manufacturer that lists the products you have purchased.ãEUREUR
Fill out IRS tax form 5695 (2009) to determine the tax credit.
Save copies of the sales estimates, invoices, NFRC labels, certification statements and tax forms in a file for each customer. It can help them keep the tax credit in case you or your customer gets audited.
What shouldn't I do?
Just as this article is intended for informational purposes only, don't pretend to give legal or tax advice. Customers should be advised to contact their tax professional for additional information.
And don't wait to help your customers take advantage of this tax credit. Again, this provision of the Stimulus Plan is only in effect through 2010.
