There are a lot of ways a new EPA-Certified wood burning fireplace, stove, or insert can save you money. You’ll save money by burning less cord wood or pellets because modern biomass appliances are up to 80% efficient. This means you save money on fuel costs to keep your home warm and cozy through the colder months. The savings don’t stop there. Congress reinstated the Residential Energy Property Tax Credit in December 2019. This larger tax credit includes a $300 credit for a new wood or pellet burning heater. Not only that, this applies to any qualifying stove purchased before December 31, 2020.
Below are a few frequently asked questions about this tax credit:
What is the Biomass Stove Tax Credit?
Congress created the Residential Energy Property Tax Credit to incentivize sustainable home improvement choices. This includes a non-refundable, dollar-for-dollar tax credit for biomass heaters of $300.
There are plenty of wood burning inserts and fireplaces that also meet the qualifications for this tax credit. For example, this FireplaceX Medium Flush wood insert is rated up to 76.4% efficiency.
When does this tax credit take effect?
Currently, this tax credit is valid for qualifying stoves installed before December 31, 2020. If you’re looking to make a few improvements to the energy efficiency of your home in 2020, you’ll want to take advantage of this. The tax savings don't end with stoves. You can also see savings from other home improvements, up to $500, along with the stove credit.
What fireplaces, stoves, or inserts qualify for the credit?
Biomass appliances that are at least 75% efficient qualify for the credit. That means that most EPA-Certified stoves or wood heaters, like the ones sold by Mountain Hearth & Patio, meet or exceed the qualifications for this tax credit. The credit doesn't require that your stove be manufactured in the United States. It just needs to meet the 75% efficiency mark.
Many EPA-Certified appliances such as this Hearthstone Green Mountain 60 meet the 75% efficiency qualification for the biomass stove tax credit.
How do I take advantage of this tax credit?
To take advantage of this tax credit, you must fill out IRS Form 5695 and attach it to your 1040 or 1040NR form. To receive the credit for 2018, you must amend your filing for that year. You should retain any documentation of the stove purchase from your hearth retailer. Not only that, you should also keep the manufacturer's certification statement. The manufacturer’s certification statement can be found packaged with the appliance or on the manufacturer’s website. You do not have to file these documents with the IRS but should keep them for your records.
I bought a biomass heater before Congress reinstated the tax credit. Can I still take advantage of the credit?
Yes! If you purchased a biomass heater between December 31, 2017 and December 31, 2019, you can still take advantage of the credit. This can be done by amending your tax filing for 2018 or by filing the Form 5695 with your 2019 taxes by the April 15, 2020 deadline.
Where do I find a qualifying fireplace, stove, or insert?
You can find a qualifying fireplace, stove, or insert at your local hearth retailer. At Mountain Hearth & Patio, we offer a range of EPA-Certified wood burning products. Many of our wood and pellet burning appliances qualify for this tax credit. We can help you choose the perfect stove, not just to take advantage of this tax credit but also to heat your home! Our certified staff and technicians will walk you through your fireplace, stove, or insert project and bring a money-saving source of heat to your home. Contact us through the form on our contact page or call us at (303) 679-1601 to start your renewable heating journey!
Mountain Hearth & Patio has over two decades of experience with the sales, service, and installation of fireplaces, stoves, and inserts. We work in the Foothills communities, Lakewood, Littleton, Denver, and everywhere in between!
Mountain Hearth & Patio are not financial advisors or tax preparation professionals. This article should not be considered legal or financial advice. To learn more about this tax credit and to discuss whether or not it’s right for you, consult with your accountant, attorney, or other tax preparation professional.
