Understanding The Window And Skylight Tax Credit For Energy Star Windows

Sep 26, 2023 | News

Energy efficiency is vital to increasing energy cost savings, home comfort, and overall sustainable living in our modern era. Recently, the U.S. Environmental Protection Agency (EPA)  raised the bar for Energy Star specifications with the introduction of Energy Star 7.0 standards, which feature significant improvements in U-factor and solar heat gain coefficient (SHGC) ratings. 

Another advantage of energy-efficient windows is the current Window and Skylights Tax Credit. This program incentivizes homeowners to make sustainability improvements to their primary residence. Eligible improvement projects are those that include Energy Star-certified products and equipment, like qualifying configuration of the Vector Windows’ Envision series. Homeowners can benefit both financially and environmentally by choosing eligible Energy Star windows and claiming the tax credit — and Vector windows can help you do so with ease.

Energy Star Windows with Vector Windows

What Is The Window and Skylight Tax Credit

Energy Star is a joint program of the Environmental Protection Agency (EPA) and the Department of Energy (DOE). The goal of the program is to help homeowners and businesses save money while protecting the environment through the adoption of energy-efficient products and practices. Energy Star-certified products are independently certified to save energy, and a broad selection of Energy Star products are eligible for federal income tax credits under the Inflation Reduction Act of 2022. 

The Windows and Skylight Tax Credit is effective for principal residence owners in the U.S. making improvements to an existing home with qualifying products purchased and installed between January 1, 2023, and December 31, 2032. Eligible products for the Windows & Skylights Tax Credit are exterior windows or skylights that meet the Energy Star Most Efficient criteria. Homeowners can claim up to 30% of their project cost, with a maximum amount of $600 credited. 

Per Energy Star, there are annual aggregate limits in addition to limits on the amount of credit you can claim for any particular equipment installation or home improvement. The overall total limit for an efficiency tax credit in one year is $3,200.

Tax Credits are administered by the IRS. To claim the credit, homeowners must complete Form 5695 and submit it with their tax returns to the IRS. Instructions for completing Form 5695 can be found on the IRS website.

The Importance Of Energy Efficient Windows

Energy-efficient windows not only contribute to sustainability efforts, but can also significantly enhance the quality of life and utility of a home, making them a valuable component of modern eco-friendly home improvement projects.

Sustainable windows, like Energy Star windows, minimize heat transfer and air leakage. This helps maintain a stable indoor temperature throughout the year, which lowers the reliance on heating and cooling systems and ultimately reduces the carbon footprint of the home. Choosing energy efficient windows for your home can be a simple way to contribute to the fight against climate change by promoting energy conservation and sustainability.

Energy-efficient windows also offer a multitude of benefits for occupants. They create more comfortable living environments by minimizing temperature fluctuations and drafts. Additionally, these windows protect against harmful UV rays, which can fade furniture and flooring while posing health risks. Their ability to reduce exterior noise pollution enhances the tranquility of indoor spaces, promoting concentration and relaxation.

Energy Star Windows with Vector Windows

How To Save Money with Energy Star Windows

Thanks to their energy efficient functionality, Energy Star certified windows offer both short- and long-term savings to homeowners. 

In the short-term, homeowners could expect to see a reduction in the cost of their monthly energy bills. The overall value of their home may also increase following the installation of Energy Star windows. 

When considering the long-term effects of energy-efficient windows on a home’s value and performance, one should note the remarkable longevity and durability of Energy Star windows. This allows homeowners to replace windows less often, which is as convenient as it is cost-effective. Energy Star windows may also qualify for tax savings and incentives, like the Windows & Skylights Tax Credit, which can pay off in the long run


Vector’s Energy Star Rating Windows

At Vector, we understand the importance of innovation and advancement in window product technology that contributes to home energy conservation. We’re proud that our Envision series with our available triple-pane glass option qualifies for the Energy Star 7.0 Certification. 

The high-performance warm-edge spacers in our dual-pane window products are one significant component in making our windows and doors energy efficient. The thermal warm-edge spacers, in combination with our specially engineered vinyl framing systems with small-cavity air cells, have made our Envision Series an Energy Star Most Efficient rated product for over five years.

Energy Star Windows with Vector Windows

How to Take Advantage of the Tax Credit with Vector Windows

To take advantage of the Windows & Skylights Tax Credit, homeowners should start by purchasing eligible Energy Star certified products, i.e. those that meet or exceed the Energy Star Most Efficient rating standards. 

Once you’ve purchased your qualifying windows, rely on the expertise of a professional installation team to maximize the benefits offered by your new windows. Professional window installers will take care to install your windows correctly and without damage, ensuring that the critical energy efficient functionality remains intact. 

After installation is complete, homeowners can claim their tax credit by completing tax form Form 5695 and submitting it to the IRS with their tax returns. It’s that easy to receive a federal rebate for making an eco-friendly choice for your home’s windows! This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

Investing in Energy Star windows

Investing in Energy Star windows can offer a substantial return on investment by delivering long-term cost savings through reduced energy bills and a potential increase in property value. These windows help lower heating and cooling expenses by maintaining consistent indoor temperatures, making them an essential component of any energy-conscious home. Beyond the financial benefits, they also contribute to a healthier planet by reducing carbon emissions. 

As a smart and sustainable choice, Energy Star windows combine economic advantages with environmental responsibility, making them a valuable investment for homeowners — one that is made even more compelling by the Windows & Skylights Tax Credit. Talk with your authorized Vector Windows dealer to select qualifying windows and install them in your home, so you can get rewarded for making a planet-friendly choice and get money back in your pocket!

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Contact an authorized Vector dealer today.