Perhaps you have heard of tax credit and some of us have already benefited from it, but unfortunately some have not grab the opportunity of tax credit. Tax Credit is different from tax deduction. A tax credit is more valuable than a tax deduction. Tax credits directly reduce your income tax, unlike a deduction, which reduces the amount of income subject to tax. The credit then directly increases the tax refund you receive or decreases the amount you have to pay.

The 2009 and 2010 American Recovery and Reinvestment Act reinstated federal tax cuts for consumers who make certain energy-efficient improvements to their home; which was equivalent to 30% of the window film cost or up to $1,500, but that was the 2009.

Now the 2011 tax credit for home window tinting investment by a home owner is now set to a new rate of 10% of cost or up to $500, excluding installation cost. This tax credit is applicable only the existing residential house and not to newly constructed houses or for rentals.

As you can see the tax credits have been greatly reduced and this is not only of window film product but for many products as well.  Will that mean that less people go out to buy these energy efficient home products. I would say that this change really reduced the effectiveness and the reason for the credit.  Why even have it if it doesn’t have a stimulus effect?

Bad According to Donna Shirey, the president of a Seattle contracting firm, that the net effect of all this is a big step backward, bad for the environment, bad for consumers, and most importantly bad for jobs in our country since there will be less investment on energy efficient products and services.

Well, we can do nothing about it. But all we have to do as a consumer is better to take advantage of it than nothing. If you are a home owner and want to make some improvement this year, then here is how you can take advantage of the tax credit:

1. Make a copy of the dealer invoice/receipt (make sure it states the film type and has the material cost itemized)
2. Fill out the 2011 Form 5695. Window film is referred to as an “insulation material or system specifically and primarily designed to reduce the heat loss or gain of your home” so the film cost should be put on this line (2A).
3. The total from Form 5695 should be claimed on your Form 1040, line 52.
4. Send the copies of the certification letter and dealer receipt in with your Form 5695 when you file your taxes.

Visit us to learn more  about the advantages of Home Window Tinting

Summer’s coming, and for some, utility bills the size of luxury car payments.

Fortunately for people like Davis who are facing serious energy issues, help is available.

And even homeowners without obvious problems can benefit from thoughtful energy improvements. The most fumble-fingered can complete most of them with little effort, a few hours and a bit of money for materials.

Heck, you’ll probably even qualify for a tax credit.

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