The revised federal tax credit

[muncybob]

The following is a quote from the Energy Star web site:

3A Manufacturer’s Certification is a signed statement from the manufacturer certifying that the product or component qualifies for the tax credit. The IRS encourages manufacturers to provide these Certifications on their website to facilitate identification of qualified products. Taxpayers must keep a copy of the certification statement for their records, but do not have to submit a copy with their tax return

Does anybody know if the manufacturers frequntly mentioned here(Tarm, Eko, Econoburn, etc) have these? Since there are some good choices out there for wood boilers, the up to $1500 tax credit available from one make may persuade me to buy their product versus another make that does not qualify...esp if their prices are in the same ballpark!

 

[lawandorder]

Good question never thought about it but it makes sense. Chris from Tarm is usually around here maybe he will have an answer for
Tarm owners at least

 

[muncybob]

I sent a short email to Econoburn asking this. Will post the reply.

 

[pybyr]

Muncybob- I'll be very interested to hear what you get back from Econoburn. My Econoburn EBW-150 has an "Energy Star" label on it, so I am pretty sure that they've been through the process- and hopefully it will not be a problem for them to generate the IRS-required certification document for consumers.

My EBW-150 was acquired in '08, but not "placed in service" until 1-15-09, so I should be eligible for the credit on that aspect of the criteria.

Does anyone know, or have any suggestions as to how to find out, whether there's any way to apply the credit when doing one's 2008 taxes, even though the unit was installed in '09 (and needs to have been installed in '09)-- right now, money now, in the form of a current credit, would be much preferable to money a year from now.

 

[Piker]

The Energy Star was granted to the Econoburn last year around april... but was rescinded around september of last year. Since it was the first and only energy star rated solid fuel boiler in history, many of the other manufacturers complained that there weren't set gov't standards for testing, and the Energy Star rating was removed pending further red tape. They will definitely get it back, but it looks like it's going to take a couple years for the EPA to get energy star standards set for solid fuel heating equipment.

Trevor,
In the interest of being honest and forthwright with our customers, consumers in general, and members of this forum, your energy star comment needed addressed.

The Econoburn boilers do meet requirements for energy efficient boimass boilers, and there is at least 1 $300 tax credit that is available for 2009, though I don't have the information right in front of me for that.

cheers

 

[pybyr]

Thanks for the clarification, Piker- I was not aware of that set of events- I agree with and applaud your desire to have the most accurate and information available-

Though-- from what I see on the portion of the Energy Star website discussing the tax credits, though, and from looking at the several pieces of legislation regarding this credit, the availability of the credit does not turn on whether the wood burning unit has been awarded the Energy Star label/ certification, but, rather, whether the device has a

"thermal efficiency rating of at least 75% as measured using a lower heating value"

which apparently needs to be supported by a "a signed statement from the manufacturer certifying that the product or component qualifies for the tax credit"

The recent "Stimulus" legislation actually modified last fall's legislation that had extended the duration of earlier tax credits, and that also broadened the credits to include biomass devices above a certain efficiency.

Here's a link to the text of the Fall 2008 legislation that first added the credit for efficient biomass appliances:
(broken link removed to http://www.pelletheat.org/3/residential/HR_1424__SEC_302_FINAL.pdf)

here's the actual text of the stimulus legislation as just enacted- the whole thing is ridiculously long, but the text regarding the credit that we're discussing is at Section 1121 on pages 208-209
http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=111_cong_bills&docid=f:h1enr.pdf

it looks to me like the credit can only be claimed for/ in tax years 2009 or 2010, but the good news is that the stimulus legislation now expands the credit to a higher amount.

 

[CrappieKeith]

I JUST DID SOME RESEARCH AND ALL OF THE YUKON EAGLES THAT ARE UL LISTED ARE 75% EFFCIENT AND QUALIFY FOR THE $1500 TAX CREDIT.

 

[Piker]

I have yet to investigate the new stimulus bill for tax incentives on the Econoburn boilers. The original $300 credit was something that I heard about late last year.

Thanks for the links Trevor.

Cheers

 

[pybyr]

I have yet to investigate the new stimulus bill for tax incentives on the Econoburn boilers. The original $300 credit was something that I heard about late last year.

Thanks for the links Trevor.

Cheers

You're welcome- it looks to me as if-- if/ when Econoburn can issue the official signed certification to owners, that these units, at least those "placed in service" on/ after 1/1/09, are eligible for a credit up to $1500. Suddenly, there's an upside to the fact that I didn't complete my initial install until 1-15-09!

 

[stoveguy13]

nothing is qualified yet as the IRS has not set what test standard they are using untill they do buy at own risk.

 

[muncybob]

Here is the reply I received:
Thank you for your inquiry. Sorry for the delay in response as we are
currently at a trade show in Syracuse NY. (NYS Farm Show)

We are diligently working with our Congressman, Brian Higgins, who is on the
Ways & Means Committee on getting quick rulings (as quick as they'll move)
on this matter. He was just in to the plant with his staffers last week. The
key here will be whether or not Manufacturers Certification Statements will
be accepted or if an official ASTM test protocol will need to be developed.
The latter could take up to 2 years to develop. Certification from a
manufacturer like us would include 3rd party test results from various labs
listing that the defined efficiencies are met or exceeded. We anticipate the
final IRS rulings to be released in the next 2-3 weeks. This saga has been
going on since the initial bailout bill last October.

Sincerely,

Mark J. Odell, VP Sales & Marketing

 

[Titus]

My wife is a CPA and I've been working at her firm to help out with the taxes.

There is NO tax credit or deduction you can take for 2008. Even the credits for insulation and efficient windows did not apply for last year. Imagine how much fun it is to explain to clients that there was a deduction for 2007, and will be one for 2009, but none in 2008.

Exactly how the credits will be applied, exactly what qualifies, manufacturer letters, etc. are all still in flux. We'll all know more this summer. Then you can take something when you file NEXT year.

 

[CrappieKeith]

If the unit is UL listed it will be at least 75% efficient as UL will not list a bio mass furnace unless it is at least 75% efficient.

 

[muncybob]

Here is the link to the energy star website that shows many credits available for various reasons:
(broken link removed to http://www.energystar.gov/index.cfm?c=products.pr_tax_credits#c5)

 

[RowCropRenegade]

1500 dollars is a pretty good sized tax break. This will have to factor into my decision. I wonder if I install this boiler in my barn if I can get a little farm use exclusion too.

 

[Chris Hoskin]

Hi All, have been out of the loop for a few days here. Just checking back in. To save me a bunch of typing, I am just pasting a letter that we sent to our dealers earlier this week:

______________________________________________________________________



Hello Dealers,

We have exciting news for you about the tax credit available for biomass-burning appliances that is written into the Economic Stimulus package that was signed on Tuesday. While there are still unknowns within the section that pertains to this tax credit, we can assure you that we are actively monitoring the developments and will immediately pass on the details to you as they become available. Our industry connections are meeting with the IRS on Friday of this week to gain a better understanding of the tax credit.

After a thorough review of the pertinent information within the bill, as well as several consultations with our industry partners, we can confirm that there will be a 30% tax credit (of up to $1,500 per household) for the purchase in 2009 and 2010 of a 75% efficient biomass-burning appliance. Sales that occurred earlier in 2009 (before the package was signed) will be honored.

We would like to bring two finer points of the package to your attention:
1. While the tax credit takes effect immediately, guidelines have not been issued for determining what systems meet the efficiency requirements to qualify for the credit, or how a manufacturer goes about qualifying their products. As many of you know, there are no efficiency or emissions tests in the US for indoor biomass boilers at the present time. Government guidelines for testing are expected by April 30, 2009.
2. There was language added to the bill just before signing that reads that the boiler must be a "75% efficient appliance as measured using a lower heating value." This phrase (lower heating value) refers to the fact that biomass, as a natural fuel, will have varying energy content per pound. For testing purposes, wood fuel (pellet or cord wood) can have an energy content ranging from 8200 Btu/lb. up to 8700 Btu/lb. Because the required efficiency test will use the lower value, we have a distinct advantage, especially if the fuel used in the test happens to have a higher Btu content per pound than the figure the lab is using for calculating efficiencies.
This is very exciting news for our industry and our customers. This incentive could mean the difference between a modest year and another boom year so we are very pleased by the announcement and are eager to share the details with you. You'll be hearing from us as soon as new information is available. Thank you, as always, for being a part of our trusted dealer network.

___________________________________________________________________________

So the short version of all of that is that this is very good news for the industry and consumers, but there are still some details to be worked out around efficiency ratings and testing. From today's perspective it certainly seems assured that any gasifier will qualify. We are still waiting to here the final details before we "go public" promoting this, but we are very pleased and optimistic. Anyone feeling stimulated??

 

[Chris Hoskin]

sorry, forgot to sign the above post: It's Chris from BioHeatUSA. I normally post from home under a different screen name.

 

[webbie]

I JUST DID SOME RESEARCH AND ALL OF THE YUKON EAGLES THAT ARE UL LISTED ARE 75% EFFCIENT AND QUALIFY FOR THE $1500 TAX CREDIT.

75% efficiency on the BIOMASS side? (wood). I highly doubt it.......but who knows, maybe you can slip in somehow.

It would be almost impossible (or impossible) to get 75% out of a firebox that size with natural draft and a design from many years ago.

Perhaps you are talking about the oil side? (75%)......

 

[lawandorder]

So, if youi bought and installed in 2008 your S.O.L??? Nice...... Thats what I get for trying to be ahead of the game...........

 

[woodmeister]

I'm with you there landowner!

 

[muncybob]

Perhaps my chronic procrastination will pay off this time!! Actually, if not for a financial letdown last year I would have bought in 2008 also. At any case, this will be interesting to see how it plays out. Appears this would be the ideal year for a first time homebuyer to buy a fixer upper house....mtg rates still decent(if you can qualify!), deflated values, some interest free $$ from the Feds to buy and several tax credits available to make the home more efficient. I've already told my daugter if she intends to buy she better do it soon!

 

[muncybob]

Chris...does the Tarm Excel multi fuel unit already meet the specs on the oil side? If so, does that not mean it already qualifies for the credit?

 

[hoth2oguy]

Yes, lawand order, SOL. Of course you have probably saved at least $1500 in fossil fuel costs, so I wouldn't look at it as a mistake - you just got an earlier start on your savings!

Muncybob, the incentive I am talking about relates to biomass appliances only, so the wood side of the Excel will have to be subjected to whatever efficiency verification is determined. Of course, the wood side of the Excel is essentially the Solo Plus, so that should not be a problem.

I BELIEVE there is a fossil fuel efficiency incentive too and that it requires 85% minimum efficiency. The Excel runs at 84% efficiency on oil and 86% on LP or NG if I remember correctly. These are operating efficiency numbers, not AFUE numbers, and I'm not sure what the incentive calls for. The Excel is a pretty high mass boiler and so the AFUE is not the best; if you are going to run primarily wood and use the fossil fuel side as a true back up, it can make a lot of sense.

 

[shagy]

If the unit is UL listed it will be at least 75% efficient as UL will not list a bio mass furnace unless it is at least 75% efficient.

Thats not true. Many outdoor furnaces have a UL listing and are not 75% eff.

 

[Rory]

What about bought in 2008 but installed in 2009? The original language only referred to the PIS date, but the purchase date seems to have been added. It's not really clear at this point was the final language is.