Tax credits and other money saving programs

Big incentives for Bloomington homeowners

Related: Learn about a 35% rebate, up to $10,000, for home energy efficiency improvements...

Tax credits for improving your home's efficiency

The U.S. Department of Energy's Energy Star website external link contains information on tax credits available for up to $1,500 toward the cost of energy-efficient home improvements. The credits are available to owners who use the house as their primary residence. There is no income cap.

The energystar.gov website external link says that the following improvements are eligible for a tax credit:

Energy-efficient windows and exterior doors.
Insulation.
Energy-efficient metal or asphalt roofs.
Energy-efficient furnace, air conditioner, heat pump, or boiler.
Energy-efficient water heater.

In addition, the site lists tax credits that are available for up to 30% of the cost of these energy-efficient improvements, through 2016:

Geothermal heat pump.
Solar panels.
Solar water heater.
Small wind energy system.

Bloomington homeowners should investigate new federal income tax breaks that provide a big incentive for homeowners to quit procrastinating and invest in energy improvements for their home. You could raise your comfort level, lower your energy bills and get a credit up to $1,500 by installing insulation, replacing leaky windows and doors, and replacing an old furnace or air conditioner with energy-efficient models. Only improvements to your primary residence qualify for the credits.

There are no income caps or phase-outs, so 22,000 Bloomington homeowners are eligible for this credit. If every Bloomington owner took advantage of this incentive, it would be equal to a federal investment of $33 million in Bloomington.

Consult your tax planner and review all IRS guidelines before making improvements. The City of Bloomington is not a tax advisor.

Here's a summary of what's available:

An income tax credit for 30% of the cost of energy-efficient doors and windows, insulation, air conditioners, furnaces, heat pumps and boilers, up to a lifetime cap of $1,500. This credit is available for improvements put into service during 2009 and 2010.
For windows, doors, insulation and other similar projects that tighten up the "envelope" of your house, the credit applies to the cost of materials. However, if you buy a new air conditioner, furnace, heat pump or boiler that meets the energy-efficient guidelines, the cost of installation can be included when calculating the credit.
There are extended tax credits for projects such as solar water heaters, geothermal heat pumps and wind energy systems. Homeowners who install these more complex systems are eligible for a tax credit of up to 30% of the cost of labor and materials, with no caps. The extended tax credits for complex systems are available through 2016.
For more information about eligible energy-efficient home improvements, visit:
- Alliance to Save Energy's website.
- Informational page on the Energy Star website.
For information on City electrical, plumbing, mechanical and building permits for this type of home improvement, call the Building and Inspections Division at 952-563-8930. Information about is also available via this Building and Inspections slide show on our website.

Other money-saving programs

Consumer Energy Tax Incentives – What the American Recovery and Reinvestment Act Means to You. Visit the Department of Energy's Consumer Energy Tax Incentives page for more information.

Foreclosed Home Improvement Program (FHIP) – The Bloomington Housing and Redevelopment Authority has funds for loans up to $20,000 for people with newly bought foreclosed homes. Visit the HRA's FHIP page to learn more about the programs eligibility standards and details.

Bloomington’s Housing and Rehabilitation Loan Program – The Bloomington HRA provides home improvement loans to 30-40 low and moderate income homeowners. The maximum loan is $35,000 and do not need to be repaid until recipient sells, transfers title or no longer lives at the home. Visit the HRA's Housing and rehabilitation and neighborhood preservation page for more information.

Bloomington’s Neighborhood Home Improvement Loan Program – Each year the City of Bloomington selects specific target areas for its Community Enhancement Program. Maximum loan is $30,000. Visit the HRA's Housing and rehabilitation and neighborhood preservation page for more information.

Neighborhood Energy Connection – Provides loans through the Community Fix-Up Fund at low interest rates up to $35,000 to help weatherize your house. Visit the Neighborhood Energy Connection's Minnesota Energy Loan page for more information.

Low income options for those that qualify – Amount of assistance depends on weatherization needs. Visit the U.S. Department of Energy's Weatherization Assistance Home Page and follow the steps to apply for assistance.

Stay warm MN – Low income family assistance Homeowners need to meet income eligibility requirements. Once application is approved weatherization work can begin through an approved contractor. Visit the Office of Energy Security's Weatherization Assistance Program page for more information.

Sustainable Resource Center – Once assistance is obtained you have the option to choose the Sustainable Resource Center who serves the entire metro area. They provide basic home energy diagnostics all the way up to whole house weatherization services. Visit the Sustainable Resource Center's website for more information.