Can Insulating your Home Save you Money? It Can at Tax Time – Virginia Foam Insulators

Can Insulating your Home Save you Money? It Can at Tax Time

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Are you looking for some helpful ways to reduce your energy consumption and cut back on your utility bills? You may want to consider one of the best money saving and energy saving solutions by properly insulating your home. Increasing energy usage and energy costs in your home can be burden to your bank account, but adding the right type of insulation can make a world of difference.  One crucial benefit of home insulation can be especially helpful to you and your wallet during tax season.

To add insulation to your living space, can possibly save you a significant amount of money in the long run, and can also make your home more energy efficient. This not only prevents heat loss and cold air leaks from happening in your home, but adding insulation is also a long term investment that won't hurt your savings account.

Not to mention, with the institution of energy-efficient tax credits, you now have another great reason to get the insulation work done.  Getting your home insulation installed properly is important, but so is knowing how to properly claim your energy efficient insulation tax credits.

Energy-efficient Tax Credit

In 2010, Congress put into effect substantial tax credits of 30% of the purchase price with a limit of $1,500 for homeowners who make qualified energy-efficient improvements on their home. While these breaks have more recently been reduced to just a mere 10% of the purchase price (up to $500) now, there is still an abundance of ways in which you can find effective cuts on your future tax bill.

Specifically, by ensuring that your home improvements match up to energy efficiency standards, you may be able to greatly benefit during tax time.

The energy efficiency tax credit can be one of the best incentives for homeowners in order to significantly reduce your home insulation costs.  It is a commonly known fact that adding insulation to a home can save you money over the long run, but there is still the initial cost of both product and installation to consider.

To help make your energy efficient insulation choices more affordable, there is a great opportunity to save your hard earned money with claiming insulation tax credits.  These tax credits are a great way to assist you with cost reductions on insulation improvements.

Claiming insulation tax credits

Here are a few pointers listed below for you to quickly and easily understand what the requirements are in claiming insulation tax credits.

  • For insulation, tax credits are available for up to 10% of the purchase price, or up to $500. Any installation purchase made that is over $5,000 will not be eligible for a rebate.
  • You can only claim the credit for your primary residence. Vacation homes and rental properties are not applicable, neither is a newly constructed home.
  • You must keep a copy of the Manufacturer’s Certification Statement. This is a statutory statement by an insulation manufacturer certifying that the product passes for the tax credit. Make sure the manufacturer of the product you choose has this certification.
  • To claim any insulation tax credits, you will need to file Form 5695, Residential Energy Credits Form specifying the amounts you are claiming. This form is to be attached to your tax return form. As a tax credit, it will be deducted from your tax bill and as a result, will then reduce your taxes dollar for dollar.

It is also important to be aware that the tax credits are non-refundable.  Thus, you cannot come in for a refund check against the balance credit that remains unused after deducting the taxes due. In other words, your savings will not be able to exceed the amount of tax you owe.

For example, if you happen to be eligible for a tax credit of $500, and the specific amount in taxes you owe is only $400—the excess amount of $100 is nonrefundable.

Insulation tax credits are a great incentive and a positive step in the right direction to help you lower your future energy consumption. These energy efficient tax credit credits are exceptionally beneficial if you have already completed or are planning to start an upcoming insulation project.

If your home's insulation lacks strength and power, now is the best time ever to contact Virginia Foam Insulators for an insulation installation. Not only could you be eligible to be awarded a tax credit, but you may be able to save a significant amount of money on your future utility bills.  Insulation is a sound investment for the safety and well-being of your home and family.

Looking to Get a Tax Credit and Save Money on Electric Bills?

Call Virginia Foam Insulators for the best spray foam insulation service in Central Virginia