Vinyl home replacement windows come with many benefits: energy efficiency, improved appearance, and impact resistance. Yet there was one benefit that came as a surprise to homeowner Meghann Crarey.
“I’d gotten the Alside windows last fall, and I was very pleased with them,” she explained. “They look great, the installers did a fantastic job, and I’ve already seen the difference in my heating bill. But honestly, I didn’t really think about the Alside windows much after they were put in.”
That was true, at least, until tax season rolled around. That’s when Crarey’s replacement home window purchase became a topic of conversation once again.
“Our accountant was going over the paperwork with us, and she asked us about any home improvements. I couldn’t really think of any, but then my husband said, “We did have the Alside windows put in.” She smiled. “Was I glad he mentioned that!”
Having home replacement windows installed can qualify a homeowner for a substantial tax credit. Home replacement windows are considered an eligible building envelope component — a factor that can contribute to a home’s overall energy efficiency and hence attractive to the government. Because the government wants to encourage energy efficiency, substantial tax credits are offered to homeowners who install home replacement windows and doors.
As of this writing, federal tax credits for home replacement window installation max out at $200. Individual states have their own tax credit programs, some of which are very favorable to home replacement window installation.
There are certain criteria to keep in mind when buying home replacement windows. Your purchase of home replacement windows must occur during the tax year in which you claim the credit. You can only offset the cost of the actual windows with the credit — labor, installation, and delivery charges are not eligible. You’ll need an invoice from your replacement window dealer detailing the cost of the window.
Replacement doors are often also eligible for these tax credits, and must meet similar criteria.
“It’s not a ton of money,” Crarey admitted, “but it certainly helped our tax situation. I wonder how many other homeowners would consider home replacement windows if they knew there were tax benefits.”
The best way to determine if you’d be eligible for tax credits due to home replacement window installation is to speak directly with your tax advisor. They’ll have a far better grasp of your financial situation than we can offer you here in this blog.
Tax considerations can certainly accelerate the payback time associated with new home replacement windows. “We got $200 back,” Crarey said. “That’s almost the cost of one window, in and of itself — it was like we bought these eight windows, but with the tax break, we got one for free.” Couple that tax benefit with the savings due to energy efficiency, and “Opting for home replacement windows is a no-brainer,” Crarey said. “They really do pay for themselves! What could be better than that?”