How to Deduct New Windows on a Home

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If your new windows are energy-efficient and you installed them in your primary home, you are able to claim the energy efficiency tax credit. In order to qualify, the window must have a U-factor and Solar Heat Gain Coefficient (SHGC) of 0.30 or less. To claim the credit, you must file a form 5695 and use form 1040 when you file your tax return. Tax credits directly reduce the tax you owe, which will usually save you money.

Step 1

Determine the cost of replacing your windows. Make sure that you keep records documenting your costs in case the IRS questions your tax return.

Step 2

Complete form 5695 to determine the amount of the credit you are eligible to claim. The credit equals the lessor of 30 percent of the cost of installation or $1,500. For example, if you spent $1,000 on new windows, you would be able to claim a $300 tax credit. If you spent $5,000, you would only be eligible to claim $1,500.

Step 3

Write the result from form 5695 onto line 46 of your form 1040 tax return. This will ensure that your tax liability decreases because you claimed the tax credit.

Tip

You can claim the deduction for the costs of as many or as few windows as you replace. You do not have to replace all of the windows in your home to qualify.

Warning

Be sure to attach form 5695 to your form 1040 tax return to document your tax credit when you file your return.

Things You'll Need

  • Form 5695

  • Form 1040

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