As the 2005 tax season wraps up, keep in mind next year's new tax credit for new homes qualifying as energy efficient. The Energy Policy Act of 2005 (EPACT), signed by President Bush in August 2005, outlines new Federal tax credits for consumers and businesses pursuing energy efficient usage.
Specifically for home builders, EPACT provides tax credits up to $2,000 for the construction of a qualified new energy-efficient home. The home must save 50 percent of the heating and cooling energy compared to the 2004 International Energy Conservation Code (IECC). HUD code manufacturers can also be credited up to $1,000 for homes meeting the Energy Star criteria or saving 30 percent of their annual heating and cooling energy consumption. To apply for these tax credits, construction must take place between January 1, 2006 through December 31, 2007.
For more information on energy efficiency tax breaks for builders, visit www.eere.energy.gov/buildings or call 877-EERE-INF. Also check with your local state's energy office for other state tax breaks.