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Archive for December 2019

Biomass Stove Tax Credit Extended to December 31, 2020

Tax credits are powerful incentives for potentially hesitant consumers to invest in new biomass-fueled freestanding stoves and energy conservation technology. For nearly a decade,

HPBA has worked in Washington, D.C. to maintain a tax credit for purchasers of new biomass stoves so that communities and individuals can reap the financial and environmental benefits that newer, more efficient technology provides. 

UPDATE: In late December 2019, the biomass stove tax credit was extended for qualifying purchases made before December 31, 2020. Remind consumers that they are able to claim the credit on their 2018 and 2019 returns if they made a qualifying purchase in those tax years. 

HPBA continues to fight for another extension of this important incentive for consumers to invest in cleaner, more efficient technology. 

Industry Specific FAQs

When does this tax credit go into effect and how long will it last?

This tax credit is valid only for the purchase and installation of a qualifying biomass stove made before December 31, 2020. Consumers would claim the tax credit in the year in which it was purchased.

What is the Biomass Stove Tax Credit? What products qualify?

This federal tax credit is an opportunity for the hearth industry to promote energy-conscious purchases to consumers that improve the energy efficiency of their home. It is a $300 dollar-for-dollar, non-refundable, tax credit for purchasing a qualifying biomass-burning stove before December 31, 2020. Biomass simply means the stove uses wood or pellet fuel.

Any biomass appliance that meets or exceeds an energy efficiency rating of 75 percent qualifies for this credit. This credit applies to qualifying stoves that heat the air or water. However, visit your local specialty retailer who can explain which products qualify for the tax credit. Manufacturers must provide documentation proving in some way that the appliance qualifies for the credit.

What Does the IRS Say? 

Energy-efficient building property (covered by this credit includes) a stove that uses the burning of biomass fuel to heat your home or heat water for your home that has a thermal efficiency rating of at least 75%. 

What must a manufacturer's certification statement contain?

A manufacturer's certification statement must contain the following information: 

  • The name and address of the manufacturer.
  • Identification of the class of qualified energy property (Biomass-Burning Stove) in which the property is included.
  • The make, model number and any other appropriate identifiers of the stove.
  • A statement that the product is an eligible qualified energy property.
  • A manufacturer's certification statement must contain a declaration, signed by a person currently authorized to bind the manufacturer in these matters, in the following form: "Under penalties of perjury, I declare that I have examined this certification statement, and to the best of my knowledge and belief, the facts are true, correct, and complete."

If a customer claimed this tax credit in past years, may they claim it again this year?

Yes, but only if they haven't reached the credit claim cap of $500. That said, if consumers are in your store looking to update their appliance, there may be stove accessories that you could recommend to enhance their experience (even if they aren't eligible for the tax credit).

What Does the IRS Say?

If the total of any non-business energy property credits you have taken in the previous years (after 2015) is more than $500, you generally cannot take the credit. 

Why was 75 percent efficiency selected?

The 75 percent efficiency number was originally designated by the U.S. Congress in 2008 as part of the Emergency Economic Stabilization Act and was used again for this tax credit.

Does the stove need to be manufactured in the U.S. to qualify for the credit?

No, there is no "Buy America" component to this tax credit.

What should a retailer advise the customer retain for tax purposes?

Retailers and consumers must keep exact records of any sale or purchase. Retailers should provide a consumer with the manufacturer's certification statement for the specific product model purchased. A consumer may rely on a manufacturer's certification statement that their products are qualified energy property. A taxpayer is not required to attach the certification statement to the return on which the credit is claimed. A consumer claiming a credit for the qualified non-business energy property should retain the certification statement as part of the taxpayer's records.

Manufacturers should make this certification document available to consumers on their website, in the product packaging, or in some other easily accessible manner.

What Does the IRS Say?

For purposes of taking the credit, you can rely on a manufacturer’s certification in writing that a product is qualified residential energy property. Do not attach the certification to your return. Keep it for your records.

With 8.8 million households in the United States using wood stoves as a secondary source for heating, regular maintenance and cleaning of the appliance is a necessity for many people nationwide. However, many wood stove owners may not be familiar with the importance of cleaning their stoves, how to do it, or when to let a professional step in. Whether you’ve just installed a wood stove in preparation for winter or you’ve had one for some time, here are some of the basics about care and cleaning that you should know.

The importance of proper care

While cleaning your wood stove might sound redundant (until it becomes noticeable), it’s an important part of owning a wood stove that should never be overlooked. This is because an unclean stove — including both the chimney and flue — can not only prevent it from working properly, but can easily become a fire hazard due to the build-up of creosote, which also makes it a health hazard as well. With that said, the cleaning and proper care of your wood stove are necessary for proper efficiency and safety, as regular maintenance can help keep your stove in an ideal condition that doesn't harm anyone's health.

Cleaning your stove 

While how often your wood stove gets cleaned depends upon how often it’s used, it should still be done at least once a year. When it does need to be cleaned, always begin with the stove completely cold in order to avoid burning yourself. Then, you can scoop out the ashes with an ash shovel and wire brush and put them in a metal bucket. Next, scour the buildup and rust off with a wire brush. The exterior of the stove can easily be cleaned with a vinegar solution and rag. As for the glass, a cold piece of charcoal can easily rub away any soot, and after you wipe it with a paper towel, you’ll find that it’s clean. However, when it comes to cleaning more complicated aspects of your stove — like the chimney and flue — calling a professional can be a good idea.

When to call a professional

Calling a professional to clean your stove is never a bad idea, especially if you don’t feel comfortable with cleaning the stove yourself or don’t have the proper equipment to do so safely. Professionals can ensure that your stove is properly and safely cleaned, inspected, and safe for use. Many may use high tech equipment as well, which can be expensive to buy and hard to obtain for personal use. Thus, calling a professional can prove to be a quality and convenient service for wood stove owners, in addition to bringing peace of mind and reducing stress surrounding the issue.

While it’s definitely possible to clean your wood stove yourself, it’s necessary to be informed of the several safety precautions to take when doing so. For example, when disposing of the ashes, it’s necessary to do so properly by keeping them in a metal bucket for 24 hours (in case they contain any live coals). It’s also very important to take care when cleaning the chimney in order to prevent falling off the roof. Due to the extent of safety precautions needed, utilizing a professional is always a great idea. 

Cleaning your wood stove and keeping up with its maintenance is an absolute necessity in order to keep it working properly and safely. While many may call a professional to do so, others may choose to take care of it themselves. No matter the situation, it’s important to be aware of the safety precautions involved.

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