Considering the benefits and incentives associated with the American Recovery and Investment Act of 2009, the optimum time for homeowners to replace old, inefficient, worn out windows may well be now.

The legislation provides homeowners the opportunity to claim a 30 percent tax credit of the cost of energy efficient products which have been deemed eligible for remodeling and replacement projects. A tax credit is a direct reduction in an individual’s tax liability for a given year, thus can be deducted directly from taxes owed to the IRS that year. The bill allows for a maximum credit of $1500 for the years 2009 and 2010 combined for energy-efficient remodeling or replacement projects. 

So what is the criteria for choosing replacement windows (or doors) that will qualify for the tax incentives? It is important to confirm that the energy-efficient windows you choose to replace your older versions will be covered by the tax credit. Windows are typically “graded” or rated using two measurements, a heat loss parameter call the U-Factor, and a heat gain parameter call the Solar Heat Gain Coefficient (SHGC). The door or window that you choose must have a U-Factor and SHGC rating of 0.30 or less to meet the criteria required to qualify for the tax credit, and this rating must apply to all climate zones in the United States. Typically, there will be a label on the product which defines the U-Factor and SHGC ratings for that particular window or door, giving the National Fenestration Rating Council (NFRC) information for that item. If the product does not have this label, it likely does not have a certified NFRC value — and the NFRC label (or a Manufacturer’s Certification Statement) will be required to be submitted with your tax documents when you file your tax credit claim (along with your sales receipt).

To take advantage of the tax credit for replacing old windows, you must purchase and install a qualifying window in your primary residence between January 1, 2009 and December 31, 2010. Only the costs of the windows (or doors) themselves are eligible for the credit, not the installation costs, so be sure to separate the charges on any sales receipts that are necessary for submission to the IRS.

Given that the federal government has made it less expensive for homeowners to implement upgrades to their primary residences that will save energy (not to mention money), now is certainly an excellent time to consider replacing windows. Readers, have any of you taken advantage of this program? If so, please share your experiences with a comment!

Cindy Conservation American Recovery and Reinvestment Act, energy efficient remodeling, energy efficient tax credit, NFRC Label, replace windows, replacement windows