How to Deduct New Windows on a Home
- 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.
- 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.
- 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.
Source...