Long-Time Homebuyer Credit & Residential Energy Credits

[gfizer]

Taxpayers built a new home which they occupied for the first time on 12/3/09. They lived in their previous home for 30+ years. As I see it they clearly qualify for the $6500 long time resident credit. As a part of this new construction they installed windows, doors, and a geothermal system which qualify for the residential energy property credits.

I searched the archives and found where someone posted that residential energy credits couldn't be taken on new construction but the IRS instructions for Form 5695 state:

Who Can Take the Credits:

You may be able to take the credits if you made energy saving

improvements to your home located in the United States in 2009. For

credit purposes, costs are treated as being paid when the original

installation of the item is completed, or in the case of costs connected

with the construction or reconstruction of your home, when your original

use of the constructed or reconstructed home begins.

I've looked at the instructions and other information for both of these credits and can't find any guidance on this subject. Can my taxpayer take both the $6500 long time resident homebuyer credit and the residential energy property credits for windows, doors and geothermal system on their 2009 return?

Thanks for your input!

[TAXBILLY]

Did they install the energy items after 12/2/2009?

taxbilly

[kcjenkins]

Yes, they can take both.

[Gail in Virginia]

Now I am curious, since I posted before about windows and doors in new construction and was told the credit was not available. I knew the instructions say "or in the case of costs connected with the construction or reconstruction of your home, when your original use of the constructed or reconstructed home begins." But I thought the code limited the credit for windows and doors to replacements. Which is it?

[gfizer]

Did they install the energy items after 12/2/2009?

taxbilly

No. They were installed during construction but were first used when the taxpayers occupied the home on 12/3/09.

[TAXBILLY]

Then they are eligible.

taxbilly