ecoEnergy Rebates and Home Renovation Tax Credit Work Together

Ecoenergy rebates

There has never been a better time for homeowners to upgrade their homes for both energy-efficiency and curb appeal. Because not only is the Canadian government increasing its funding of the 2007 initiative to help homeowners lessen their energy costs is also allowing the same residence a Home Renovation Tax Credit (HRTC) of up to $1350. In other words a homeowner can change out an old furnace, add insulation and put in new windows under the ecoEnergy program and, in addition, receive a tax credit on his or her 2009 income tax for having a deck built.

ecoEnergy: A Bold Initiative

Natural Resources Canada (NRCan) is the government agency responsible for offering a residential energy efficiency assessment service to the owners of residential homes. This includes detached, semi-detached and low-rise multi-unit residential buildings - or MURBs - that are three storeys or less in height. Under NRCan's ecoENERGY Retrofit program these designated property owners can receive federal grants for increasing the energy efficiency of their homes and by reducing their home's affect on the immediate surroundings and, as well, the environment.

The Energy Audit

To qualify for energy rebates a homeowner must have an energy audit completed with a local NRCan-certified energy auditor. This person will come out to the home and conduct an inspection to calculate how much energy can be saved. He or she will first go around the home and check the windows, doors and roof areas for leaks or damaged areas where the weather can get into the home.

From the inside, the inspector will start in the attic and go through the home right down to the basement. In addition, a blower test will be done on the home to check for leaks that would not be visible to the human eye. For this a tent-like apparatus is set up on the front door with a hose leading back to a heavy-duty fan. Once the fan is turned on the effect will simulate a 50 kph wind on the outside of the home by depressurizing the inside space. Then by using small puffs of smoke and listening to any whistling from around doors, windows and chimney vents the auditor will be able to determine where the cold air is entering the home. Within a few weeks the homeowner is presented with a personalized report of the audit that includes a recommended areas when the energy efficiency of home or MURB can be improved. This also includes decreasing water consumption. In addition the report will detail the amounts eligible for each improvement as specified in the report.

Home Renovation Tax Credit (HRTC)

In addition to the NRCan energy audit program the Canada Revenue Agency (CRA) has allowed homeowners to get a tax credit for renovations up and beyond improvements that just save energy. This will include almost every type of upgrade from fences to landscaping. The calculation for this program is 15% of the renovation after more than $1000 is spent. This will allow a homeowner up to $1350 as a tax credit on his or her 2009 income tax return.

The best part for homeowners is that both programs can be put in place on one renovation. For example, if a homeowner installs a new gas furnace and insulates the basement for a total cost of $9,000 he or she would be eligible for:

    1. EcoEnergy rebate of $600 for the furnace.

    2. EcoEnergy rebate of $100 for basement header insulation

    3. EcoEnergy rebate of  $500 for basement wall insulation for R-10 to R-23

    4. Home Renovation Tax Credit would be 15% of $9,000 for $1350 against the 2009 taxes.

So the total advantage of rebates and the income tax credit would be $2550 or 28.3%

Unlike the ecoEnergy program the HRTC is family-based and so that MURBs are not covered. This is because apartments are allowed write-offs as business expenses whereas homeowners are not allowed to claim renovations as federal income tax deductions. Proper documentation must be kept in case of an audit and the program is only good until the end of 2009 and will not include any improvements started before January 28, 2009.

To many experts who have reviewed this plan NRCan has gone very light with regard to rebates for windows. Even putting in an $800 window or door will only get a homeowner $30 for a rebate while he or she can get $150 for air sealing. There is also a bonus $150 if the auditor deems that the sealing has reached a 20% reduction in heat loss or better. The idea behind this reasoning is that stuffing leaks will increase the energy-efficiency of a home more than replacing windows. In fact with each energy audit the homeowner receives a kit complete with CFL lights, a toilet bladder to reduce water and plastic film to put over windows in the winter. This is because covering the windows will decrease the heat loss of a home more than replacing them will.

For more information on how you can take advantage of ecoEnergy Retrofit Program, consult our Contractor Directory or simply Post Your Project online at and have qualified contractors contact you.

Posted by: TrustedPros
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