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February 22, 2006
JS-4062
Treasury Secretary Promotes Energy-Efficient Home Construction
Torrington, Conn. – Treasury Secretary John W. Snow visited T&M Building Company in Torrington, Conn. this morning to discuss the availability of new tax credits for homebuilders that construct energy-efficient homes and homeowners who improve the energy efficiency of their existing homes.
"Improving the energy-efficiency of new homes and increasing the energy-efficiency of existing homes are both highly effective ways of reducing our national energy consumption, which is a priority that the President set forth in his State of the Union Address this year," Snow said. "Guidance for two new tax credits, issued yesterday by the IRS, will provide incentive and reward for these energy-saving efforts."
The tax credits described by Snow are part of the Energy Policy Act signed by President Bush last summer. Snow pointed out that "Homes and homeowners who qualify for these credits will showcase a win-win scenario where precious energy is conserved while families also save money on heating and cooling bills – both goals of the President's Energy Policy Act of 2005."
After touring the T&M facilities, Snow spoke to company managers and employees. "I applaud the owners and employees of T&M for the contributions they have made by building homes in over 40 Connecticut communities, and I encourage them – and builders all over the country – to continue with efforts to make new homes more energy-efficient. As the President has said, the power of technology and the innovative spirit of America – through both energy production and efficiency – will reduce our reliance on foreign sources of energy, which will help ensure a growing and prosperous America in the 21st Century," Snow continued. "There can be no question that energy savings should start at home – and that's what these tax credits are all about."
Homebuilder Credit Guidance
- Who Qualifies & How Much:
- Site-built homes qualify for a $2,000 credit if they reduce energy consumption by 50 percent (relative to the
- Manufactured homes qualify for a $1,000 or $2,000 credit depending on the level of energy savings achieved.
- IRS Guidance:
- Establishes a process that homebuilders can use to obtain a certification that they are entitled to the credit.
- Provides certainty to homebuilders who will be permitted to rely on certifications by independent experts when claiming the credit on their returns.
- Supplies a public list of software programs that may be used to calculate energy savings.
Homeowner Credit Guidance
- Who/What Qualifies & How Much:
-
- Homeowners may claim up to $500 in credits over the two-year period.
- Energy-efficient improvements to the building envelope qualify for a 10 percent credit, e.g. insulation, exterior windows and doors (including storm windows and doors), and metal roofs (
- Certain heating and cooling equipment that meets the energy-efficiency standards specified in the Internal Revenue Code.
- IRS Guidance:
- Establishes a process that manufacturers can use to certify their product(s) qualifies for the credit.
- Affords certainty to homeowners, who will be permitted to rely on the manufacturer's certification when claiming the credit on their returns.
Relating IRS News Releases:
Treasury and IRS Provide Guidance for energy Credits for Homeowners
IR-2006-34,
Treasury and IRS Issue Guidance for Coal Project Credit and Gasification Project Credit
IR-2006-33,
Treasury and IRS Provide Guidance on Energy Credit To Home Builders
IR-2006-32,
IRS Has $2 Billion for People Who Have Not Filed a 2002 Tax Return
IR-2006-31, Feb. 21, 2006 -- The deadline for filing a 2002 income tax return to claim a refund for that year is April 17, 2006.
REPORTS