Energy Property Credit

A tax credit is available to individuals for the installation of nonbusiness energy property, such as residential exterior doors and windows, insulation, heat pumps, furnaces, central air conditioners and water heaters. The credit is equal to the taxpayer's residential energy property expenditures plus 10 percent of the cost of qualified energy efficiency improvements. The credit is limited to a lifetime maximum of $500 and applies to qualified energy efficiency improvements and qualified energy property placed in service in 2006 and 2007.