Can I Receive a Federal Tax Credit for Replacing My Windows?

With tax season just around the corner there’s never been a better time than now to discuss potential tax benefits of replacing your home windows (and other home improvement projects). In this article we’ll be discussing Federal Tax Credit for window replacement and energy efficiency upgrades made to your home. Keep in mind though that there are also several local and state rebates available for window replacement projects. You can see a full listing of current replacement window rebates by State here.

Nonbusiness Energy Property Tax Credit

This is the section that pertains most to window replacement. In order to qualify for the Nonbusiness Energy Property Credit, equipment and materials must meet certain standards set forth by the Department of Energy. All Energy Star certified windows are eligible.

For the Nonbusiness Energy Property Tax Credit, the IRS makes a distinction between two kinds of upgrades: Qualified Energy Efficiency Improvements and Residential Energy Property Costs.

Qualified Energy Efficiency Improvements include:

• Exterior windows and skylights
• Exterior doors
• Home insulation
• Certain roofing materials

Residential Energy Property Costs include:

• Electric heat pumps
• Electric heat pump water heaters
• Central air conditioning systems
• Natural gas, propane or oil water heaters, furnaces, or boilers
• Stoves that use biomass fuels
• Advanced circulating fans for natural gas, propane or oil furnaces

Under this program you can claim a tax credit for 10% of the cost of qualified energy efficiency improvements and up to 100% of residential energy property costs. The credit is worth a max of $500 for all years combined until expiration. Of that $500 limit:

• A maximum of $200 can be used for windows.
• A maximum of $50 can be used for a furnace circulating fan.
• A maximum of $150 can be used for a furnace or boiler.
• Up to $300 can be used for any other single residential energy property cost.

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Philip A.

Philip Alexander is the founder and lead author at Pro Replacement Windows. Over the past decade Philip has served in various management capacities with several leading home improvement companies across the US, most recently with MESA. Philip combines a rich background in home renovation with a passion for helping homeowners navigate the remodeling process by providing the most accurate information and best deals. Outside of work, Philip enjoys working out, live sporting events, and exploring the latest trends in home improvement.

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