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Homeowners Save Energy, Cash With Tax Breaks: Retailers Say Sales of New, Energy Efficient Products Are Surpassing Expectations at a Time of Recession -- Thanks in Part to Government Credits and Deductions.
Thursday, August 20, 2009 1:52 AM


(Source: The Miami Herald)trackingBy Nirvi Shah, The Miami Herald

Aug. 20--So your car isn't a clunker? And you're not buying a new home?

But maybe your air-conditioning unit is on the fritz. Or your small business needs new equipment or office furniture. Perhaps you have always wanted solar panels.

Then there is a tax break waiting for you, too.

Although there hasn't been much hype surrounding these credits and deductions -- all increased or expanded by federal stimulus bills passed this year and last year -- retailers say sales of new, energy efficient products are beating expectations in the midst of the recession.

The reason, they say, is the prices are that good.

In Davie, Bob Menconi said he paid the same amount for a new air conditioner as he did for the one he bought about 20 years ago.

The price for his new Ruud air conditioner: $6,295. But the combination of a rebate from Florida Power & Light, the manufacturer and a $1,500 credit on his taxes next year means he will pay $3,520.

On top of that, he said, the first month, the family electric bill was $200 less than the previous month.

The tax credit "pushed us in the direction to do it," Menconi said. The old one "cooled the house, it was just not efficient. We wanted to catch it before it broke. At 20-plus years old, it was just waiting to bust."

Any air conditioner that qualifies for the tax credit will also definitely qualify for the FPL rebate, said Ralph Scanga, owner of Air Conditioning Excellence in Hollywood, because the federal energy efficiency requirement is more stringent than the power company's.

Federal stimulus laws allow homeowners to get a tax credit of 30 percent of the cost of energy efficient windows, doors, water heaters, air conditioners and furnaces, up to a maximum of $1,500. So if you max out the credit on your new A/C, you can't use it for one of the other items.

But if you don't use any or all of the credit this tax year, you can buy a qualifying item and claim the credit or any remaining credit in 2010, said Amy McAnarney, an executive director at H&R Block's Tax Institute. The items have to be installed by Dec. 31, 2010, for taxpayers to claim the credit.

McAnarney also cautioned buyers not to take a company's word that an item qualifies. She said to get a copy of the manufacturer's statement that says so.

Another tax credit allows homeowners to get up to 30 percent of the cost of solar energy systems, such as solar water heating and solar power, small wind systems and geothermal heat pumps if they are installed by Dec. 31, 2016. It's separate from the credit for windows, doors and air conditioners, so homeowners can use both.




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