Ask the builder: Tax credits for the energy-efficient DIY-er

Question: We recently completed some home improvements. I've heard that there may be some tax credits or rebates available if you've made your home more energy efficient. We replaced some windows and remodeled our kitchen and bought new appliances. We also replaced our very small water heater. Do you have any information on these tax issues?

As long as your improvements were completed by Dec. 31, 2007 you may be eligible for tax credits. In 2005, Congress passed the Energy Policy Act to help combat our growing energy problems. It offered incentives for consumers to make their homes more energy efficient. Unfortunately these incentives expired at the end of 2007.

Tax credits are available for many kinds of upgrades. The maximum amount of federal credits for all improvements combined is $500 per house, with an additional credit of up to $2,000 for solar water heating and solar electric (photovoltaic) panels. Each individual technology will earn a different amount of credit. Consult your tax preparer for the details.

Some examples of federal credits include:

– New insulation – 10 percent of cost up to $500

– Energy Star windows – 10 percent of cost up to $200

– Energy Star qualified doors – 10 percent of cost up to $500

– Metal roofs – 10 percent of cost up to $500

– Tankless water heaters – $300

– Geothermal heat pumps – $300

– Solar panels – 30 percent of cost up to $2,000

– Solar water heaters – 30 percent of cost up to $2,000

Question: I'm a DIY'er (do-it-yourselfer) and am adding a small addition to our home and remodeling our kitchen. My question relates to insulation. My existing home is 16 years old and I think it was insulated with fiberglass batts. There are so many insulating products on the market and I'm wondering what I should use in the new addition.

Good question, but I'm missing some information like will the addition be on a basement, crawl or slab? Will heating ducts be in conditioned space? What is your addition exterior wall system? What type of heating fuel do you use?

I could speak volumes on this topic, but let me give you some general information to get you started. As you may know, heating and cooling costs comprise more than 50 percent of your home energy consumption. Adding the recommended levels of insulation will save energy, reduce utility costs and improve comfort.

The Thermal Bypass Inspection Checklist from Energy Star provides valuable guidance on all the steps needed to ensure proper installation at R-value is not a one-size-fits-all item. Our climate, type and efficiency of your heating/cooling system, etc., influence the appropriate R-values. Visit The U.S. Dept. of Energy helps calculate insulation recommendations based on your area by zip code and asking you a series of questions like mine.

For insulation types, my preference is a combination of installing rigid board insulation between the siding and sheathing, and using either loose-fill insulation (blown fiberglass or cellulose) or bio-based spray foam in the wall and attic systems. For a more detailed description of these insulation types, visit PATH's Technology Inventory at

Have a question or comment for "Ask the Builder?" Email Mike Ferraro at

Mike Ferraro is president of Ferraro Builders and past president of the Home Builders Association of Grand Traverse Area. Ferraro Builders is a full-service design and build firm and Certified Green Builder and Energy Star Partner specializing in Custom Homes, Timber Frame Homes, and Remodeling. BN