Since 2006 there has been a provision in the tax code to incent taxpayers to purchase and install property that make their home more energy efficient. This part of the code does not tend to be in the press much because the Nonbusiness Energy Property Credit has a lifetime limit of $500.

But if you have not yet reached your $500 credit limit, review your purchases to see if you can apply for the credit before it is too late. Here is a list of qualifying purchases that could put the $500 into your pocket:

Nonbusiness Energy Property Credit items

The fine print

As with any credit there are limitations applied to receive the credit. Here are the most common;

• The costs must be qualified energy property costs.
• The costs must be paid or incurred during the tax year.
• The TOTAL combined credit for all tax years cannot exceed $500.
• The credit is 10% of the amount paid or incurred for the qualified improvements.
• This credit is only available for existing homes.

So review your purchases during the year to see if any might qualify for the Nonbusiness Energy Property Credit.

Residential Energy Efficient Property Credit The $500 nonbusiness energy property credit is not the only residential energy credit available to you. If you installed any of the following property on a new or existing home you may qualify for this additional energy credit; Solar electric property (solar panels) Solar water heater property Small wind energy property Geothermal heat pump Qualified fuel cells This credit could apply to up to 30% of the costs to prepare and install this energy efficient property.