Energy Conservation... In Your Home
Tax Credit and Incentives
Energy efficiency improvements can reduce your Montana tax bill as well
as your monthly energy bills. Montana homeowners are eligible for a
tax credit for a portion of the costs of installing additional insulation,
caulking materials or other measures that reduce energy use and lower your
utility bills. The amount of the tax credit is 25 percent of the investments
you make to improve the energy efficiency of your home. The maximum amount
of the credit for each tax year is $500 per taxpayer.
The Montana Department of Revenue has determined that all of the
following conservation investments are eligible for the credit:
- For existing homes: insulating floors, walls and ceilings
- High efficiency heating systems (ENERGY STAR rated)
- Sealing and insulating duct work or piping in non-heated areas
- Hot water tank insulation blankets
- Storm windows
- Programmable or set-back thermostats
- Replacement of incandescent light fixtures with high efficiency
lighting fixtures. This applies only to permanent fixtures, not to
efficient light bulbs such as compact fluorescents installed in existing
fixtures.
- Energy efficient windows
This is only a partial list of items that may qualify.
The Energy Conservation Tax credit can be used both for new construction
and remodeling projects. However, for new construction and remodeling
projects the tax credit is allowed ONLY for the portion of the cost and
materials that is above established standards of construction.
You apply for the tax credit by completing tax form "ENRG-C" for
individual income taxpayers. The energy conservation credit is allowed ONLY
for the year the energy conservation improvements are placed in service.
Click here to get the Montana Department of Revenue
tax forms.
2005 Federal Energy Bill Tax Credits
New federal energy efficiency tax credits will be in effect for tax years 2006 and 2007. These new credits were included in the Energy Policy Act of 2005. The improvements must be in place in 2006 or 2007 to qualify for the credit.
Some highlights are:
Homeowners can receive 10 percent tax credits up to $500 on the amount they spend to improve or weatherize their homes by adding additional insulation, improving heating system performance or weatherizing their homes.
New exterior windows are eligible for a $200 credit.
Up to $300 in tax credits for purchases of highly efficient central air conditioners,
heat pumps and water heaters. Up to $150 for installing highly efficient furnaces or boilers.
