Tax credit and deduction tips for home improvement in 2014

Tax credit and deduction tips for home improvement in 2014

(ARA) – With the new year under way, you may be thinking about needed home improvements and how you’ll use your credit to fund them. While it’s important to understand your credit before making major home improvement decisions, you should also consider another kind of credit – tax credits for energy efficient home improvements.

For the past few years, the federal government has offered tax credits for certain home improvements aimed at increasing a home’s energy efficiency. While the most popular and generous tax credits, such as the one that allowed you to claim up to 30 percent of improvements such as a new roof or hot water heater, have expired, you can still get credit for other significant energy-efficient improvements.

According to EnergyStar.gov, you can claim a tax credit for 30 percent of the cost of installing a geothermal heat pump, small wind turbine or solar energy system in your home. The credit has no upper limit and applies to both existing homes and new construction, but not to rental properties. This credit is good until Dec. 31, 2016.

You can also get a credit of up to 30 percent of the cost of residential fuel cells, up to $500 per .5kW of power capacity, EnergyStar.gov says. This credit is also available until Dec. 31, 2016.

While the initial cost of these improvements may seem significant, they can dramatically decrease home energy bills in the long run.

Depending on the type of home improvement or repair you undertake, you may also be able to claim a deduction on your taxes. Before launching a significant home repair or improvement, it may pay to consult with your tax accountant to see what, if any, portion of the cost may be deductible. And, as you do home repairs throughout the year, keep receipts and discuss the improvements and possible deductions with your accountant when he or she is preparing your tax return.

Knowing ahead of time which, if any, tax credits or deductions your home improvement may qualify for can help you make a better decision about how to use credit to fund the work. Since how you use credit affects your overall credit score, knowing the cost of a project before starting it can help you better manage your credit.

If you’re unsure how a home improvement project may affect your credit score, websites like freecreditscore.com can help you understand your credit. The site offers members a Credit Score Estimator that can help you understand how big financial decisions, like applying for a home improvement loan, may affect your credit score.

To learn more about tax credits for energy efficient home improvements, visit http://www.EnergyStar.gov. To learn more about tax deductions, visit http://www.IRS.gov. You can find a list of regional tax credits, rebates and savings at energy.gov/savings.

Don’t Get Locked Out!

At 2:17am, this morning, I was jolted out of bed by yet another of California’s reminders that we live in a earthquake zone. Of course, it’s never easy to go back to sleep after one of those. I began to wonder if I was really prepared for the chaos that can follow one of these tremors. I’m not even talking about the “Big One.” I’m talking about a mild one that might end up cutting our electricity for a period of time.

If you have a garage door that does not have a service door, it may me impossible to get your car out with out the use of an emergency release. These inexpensive items install on your overhead door and allow you open a small lock with a key and pull a small rope tied to the release mechanism. Once pulled, from the outside of the door, it releases the door opener from the door and allows you to pull open the door manually. This can be a lifesaver if you need your car to get to work or, in an emergency, get out to get supplies, food etc.

Just pull on this cable once unlocked.

You can purchase these from any hardware store or click   Here. They are easy to install and can give you peace of mind knowing that in case of a power outage you will still be able to get your car out.

We take many things in our life for granted. Electricity is one of them. Always have a back up plan.

For more information on this or any other home related issues, contact us at equityinspection.com

Your House is a Mess!

Having inspected houses for over 18 years, I’ve had the opportunity to look at things that not many people have seen. What other profession do you have the need to look into not only people’s bedrooms but their closets, under their sinks and generally their lives?

Growing up, my mother use to tell me that I kept my room like a “pigsty.” Although I’ve never had the opportunity to actually visit  one, I had visions of adolescent pigs throwing clothes, and leaving food everywhere.  She made me feel like everyone one else but me, was neat and tidy. Boy, was she wrong!

After inspecting over 7000 houses, trust me when I tell you that probably 50% the houses I inspect, I wouldn’t stay in for one night! Now, don’t get me wrong, I’m not “Mr. Clean” by any means. I consider myself pretty average. But, the way that some of these people live, would blow your mind! Keep in mind…..these people know the inspector is coming to inspect their homes! You would think that they may want to maybe get the food off of their nite stand that obviously has been sitting there for days!

It’s difficult to inspect the kitchen when can’t see one square inch of counter space, the sink is piled high with dirty dishes and it smells like an animal has died under the sink! And believe me, this is not directly related to economics. I’ve seen houses where the owners looked very well groomed, very attractive,obviously have money and  yet their homes looked like a war zone.

So the next time you feel guilty about not getting around to dusting you furniture, relax and know that you are probably much cleaner than you think!

Michael Boeger
Equity Building Inspection
310-540-0200
www.equityinspection.com

 

Energy Audits, Why You Can’t Do It Yourself

As utility cost rise everyone is looking for was to save on their energy bills. The internet, the daily paper and magazines all have tips for reducing your energy usage and expenses. These little bits of energy saving insight are great advice, but are no substitute for a professional energy audit.

A full scale energy audit evaluates the entire home for inefficiency. The audit report provides valuable information on estimated costs to upgrade individual components and their expected payoff through energy savings realized. In addition the auditor uses specialized tools such as an infrared camera and or a blower door fan, which can locate unseen and unexpected areas of energy loss.

A homeowner simply making repairs based on tips or advice is likely missing the most cost effective upgrades available for their home. Without a plan doing it yourself is shotgun upgrading, in other words scattered without clear direction.

For example many homeowners opt to replace all the old windows in their home with new thermal double pane windows. Changing the windows may in fact not yield any appreciable energy savings. Nonetheless many people go for the windows first when energy upgrading.
With an energy audit plan it may be revealed that the most cost effective places to spend that window money is on insulation and setback thermostats. Making decision without the advice and expertise of an energy saving professional can merely leave you poorer with no or little energy savings to show for you expenditures.

Some upgrades can and should be done by the homeowner. The easiest of these is changing your old light bulbs to compact fluorescents. But don’t expect to see dramatic savings in your electric bill. Lighting constitutes about 12 percent of the average families’ electric usage. This equates as follows; for a $150 a month electric bill, $18 is for lighting. Cfls save about 50-75% over incandescent bulbs. Therefore the monthly savings is $9-13 or $108-156 yearly. Not a great deal of money, but certainly a worth while investment.

This brings up the point of energy investments. Most energy improvements are investments, they pay for themselves and then some over the life of the component. What is vitally important is to identify where and what are the best energy investments for your home and budget.
A home owner working together with a trained and experienced energy professional can establish the most valuable energy upgrades for their particular home. This would include those DIY projects from the plethora of tips and advice columns. Call Equity Building Inspection today for information on getting a comprehensive Energy Audit. 310-540-0200 or go to www.equityinspection.com