The tax credit that was available on General Electric hybrid water heaters sold to members by ECI REC is back! The federal income tax return credit originally expired on December 31, 2011. However, the American Taxpayer Relief Act of 2012, passed by the U.S. Congress to avoid the fiscal cliff, reinstated this credit retroactively to equipment installed on or after January 1, 2012. It will expire on December 31, 2013.
The credits are retroactive; homeowners can claim hybrid water heaters installed in either 2012 or 2013. It must be installed into an existing home; newly built homes do not qualify. The home must be your primary residence. The water heater must have an energy factor of 2.0 or greater; the GeoSpring hybrid water heaters that ECI REC sells have an energy factor of 2.35 and 2.4. The tax credit can cover the cost of the water heater and cost of installation up to a cap of $300.
The law also allows homeowners to claim tax credits for improvements such as new windows, adding insulation, and upgrading to energy-efficient heating and cooling equipment. Here are some other eligible improvements that you may be able to take advantage of:
Up to 10% of the cost of adding insulation, installing qualifying windows and doors, and roofing materials that help reduce heat gain.
- $50 for a main air-circulating fan.
- $150 for a furnace or boiler with an annual fuel utilization efficiency of 95% or more.
- $300 for a high-efficiency electric heat pump.
- $300 for a high-efficiency central air conditioner.
- $300 for a water heater with an energy factor rating of at least 0.82, or a thermal efficiency of 90% or more.
- $150 for a biomass stove.
The total amount that can be claimed by a taxpayer for all the years the credit has been available is $500. The cap includes efficiency improvements made in previous years. If you have claimed $500 for any previous year, improvements made in 2012 and 2013 are ineligible.
To claim the credit, you will need to downoad and file IRS Form 5695 for the tax year in which the improvement was made. The water heater credit can be found on line 24a. You will also need to download, print, and file with your tax documentation this statement from the manufacturer certifying that the product meets tax credit requirements.
If you have any questions, you can call Frank Weber at our Urbana office at 319-443-4343 or 877-850-4343.