New Windows: The Energy Tax Credit and Tips for a Smooth Installation

Homeowners in the U.S. have an approaching deadline. It’s December 31, 2010. This is the final day to receive a 30% (up to $1500/owner) tax credit for installing qualifying home energy-efficiency improvers such as roofs, insulation, doors and windows. According to the U.S. Department of Energy’s website, www.energystar.gov, these items need to be placed “in service” before the deadline so each homeowner can receive their tax credit. Visit the website for details including a list of qualifying products – careful, just because a product is labeled “Energy Star” doesn’t mean it qualifies for the credit.

While the website is full of information on how to qualify, it doesn’t give you an idea on the logistics of your multi-unit, window replacement project. Based on a 50-unit HOA with 7 windows in each unit, here’s a look at how your project will likely unfold.

Timeline

These are guidelines that vary depending on type of window, weather & accessibility.

• Measure Time – 1 week
• Order Time – 1 month
• Installation Time – 2-3 weeks

Prices

Window prices depend on the type and options you require. Research & recommendations will help you find the best value. Overall, new windows:

• Install for less than $1000/ea, but increase per type
• Reduce utility bills (Fed says $377/yr in Minnesota)
• Increase resale value
• Protect your home

Resident Reaction

Cost will be an issue and some just won’t agree with the need for new windows. However, new styles have huge improvements in:

• Soundproofing
• Safety
• Functionality
• Cleaning

In-Project Experience

Some things you’ll experience during the project include:

• Install areas need to be cleared of furniture
• On-site dumpsters near driveways
• Sawdust/Debris

These numbers are dependent on type of window as well as structure. For installation, a one-story building is simply easier than a 3-story, especially if windows need to install from the outside. One major factor is whether or not your installation allows for insert windows (installing inside the existing frame) or if it requires full-frame replacement (new casing, jambs, extra time, etc.). Contractors will show you the difference and will bid accordingly.

No matter the size of your project, there are a few straight-forward things you can do to greatly improve your experience.

Choose a product with sufficient certification. Windows and doors are tested to various degrees and have warranties that correlate. Remember that only certain products qualify for the tax credit. You can find recommendations online or from other property managers.

Choose a company that is both certified and has enough support staff to handle your project. With large requirements in coordination, storage and labor-force and vendor credit accounts, your project may overwhelm otherwise solid companies that aren’t big enough.

Set a schedule and expectations. Go over the timeline with your contractor and set realistic goals. The contractor will mention ways to increase efficiency such as “anytime access” to units and on-site storage. Weather may play a factor, especially in Minnesota’s winter.

If it’s not you, assign a point person for all information and scheduling to flow through. This person will be mirrored by the contractor’s point person taking care of ordering, scheduling and – most importantly – receiving communication from the homeowners. The contracted point person has one major goal – not making your phone ring. A project will soar or sink depending on the point people.

There are other things to consider such as progress payments, seasonal logistics, and city inspections with their requirements for smoke and carbon monoxide detectors, but your contractor should be able to address these issues during your interview or bid process.

Cost will likely be your biggest issue, but you can almost certainly get a volume break. Some items such as fireproof doors and safety windows can improve insurance premiums. And, of course, there’s the Energy Tax Credit in effect until the end of 2010. The Department of Energy states that the product “must be “placed in service” from January 1, 2009 through December 31, 2010” (http://www.energystar.gov/index.cfm?c=tax_credits.tx_index) to qualify for the credit. That’s about a year from now. Your project has a turn-around time starting at 3 months (bid process, measure, order duration, install) so the deadline may be closer than you think, especially considering product availability in the wake of a tax credit scramble.

But, with foresight and just a few common-sense applications, your window project can be affordable and hassle-free.