The U.S. Energy Policy Act of 2005 permits individuals to take tax credits for remodeling that improves the energy efficiency of their primary residence. The home must be located in the United States. The maximum credit allowed in all taxable years is $500, and no more than $200 can be attributed to the cost of windows.

10% of cost up to $200 for energy-efficient exterior windows, skylights and storm windows
10% of cost up to $500 for energy-efficient exterior doors or adding storm doors
10% of cost up to $500 for a qualified metal root
10% of cost up to $500 for adding insulation expected to last at least 5 years
$300 for qualified central air conditioning, heat pumps, or geothermal heat pumps
up to $150 for a qualified gas, oil or propane furnace or hot water boiler
up to $300 for a qualified gas, oil, propane or electric heat pump water heater
up to $2,000 for solar water heating and photovoltaic systems

A federal tax credit allows for up to a $500 tax break on 10% spent on eligible energy efficiency upgrades, such as insulation. Under the Energy Policy Act of 2005, these items are eligible for tax breaks: storm windows, windows, skylights, exterior doors, storm doors; metal roofs, insulation, central air-conditioning units, air source heat pumps; geothermal heat pumps; gas, oil or propane furnaces; hot water boilers and water heaters.


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