Tax Credits for Storm Windows and Storm Doors

Storm windows and storm doors are eligible for tax credits, and offer an economical alternative to replacement windows and doors for your home.
Storm windows and storm doors are much cheaper to add to your home than full replacement windows and doors. Compounding the appeal, installation is easier and energy savings are comparable.

The federal tax credit for energy-efficient windows and doors applies to storm windows and storm doors too. As long as the windows and doors meet efficiency standards, homeowners can earn a tax credit worth 30% of the cost of materials. The credit maxes out at $1,500.

Storm windows are a fraction of the cost
Storm windows make the most sense if your home has single-pane windows. They’re designed to fit in existing openings, on either the inside or outside, and newer models open and close. It’s an immediate and inexpensive way to eliminate drafts and cut energy costs. The insulation gain from storm windows is nearly identical to most energy-efficient, double-pane windows, says Chris Dorsi, author of “The Homeowner’s Handbook to Energy Efficiency.”

While you would pay between $500 and $1,000, including installation, per tax credit-eligible replacement window, a storm window only runs about $100 to $300 installed. Contractors can outfit a typical house with storm windows in a day or two, vs. two to three days for replacement windows.

Storm doors, which limit energy loss from leaks around existing exterior doors, cost about $200 to $300 apiece. Another big benefit of a storm door, assuming it’s equipped with a retractable or interchangeable screen, is allowing air flow between the inside and outside when the weather is nice. However, because storm doors make up such a small percentage of a home’s total exterior compared to windows, the energy savings are minimal.

Qualifying for the energy tax credit
You can claim a federal energy tax credit of up to $1,500 for adding storm windows and storm doors in your primary residence during 2009 and 2010. File IRS Form 5695. The credit is based on 30% of the cost of materials only. Ask your contractor to itemize the bill. Typically, two-thirds of what you pay goes toward materials, one-third toward labor.

Storm windows and storm doors must meet energy-efficiency standards to earn the tax credit. Look for efficiency ratings on product labels. However, that’s just the start.

According to Energy Star, to qualify a window or door opening retrofitted with a storm window or door must have a total U-factor of 0.30 or less and a Solar Heat Gain Coefficient of 0.30 or less. U-factor measures how well a window or door keeps heat in; SHGC tells you how well heat from sunlight is kept out. In both cases, the lower the number, the better.

The problem lies in the fact that the standards are for the entire opening. In other words, a calculation needs to be made as to whether, say, a storm window combined with an existing window meets the U-factor and SHGC thresholds.

Karen Schneider, an Energy Star spokeswoman, says to be safe homeowners should ask a window retailer or contractor to determine the insulation value of the opening once a storm window is installed. The IRS doesn’t require homeowners to provide proof of insulation value with a tax return, but get it in writing if you can. It’s also smart to save receipts and the manufacturer’s certification statement for the product.

Homes in colder climates benefit more
You get more bang for your buck with storm windows if you live in a colder climate. Keeping heat in and drafts out adds up in energy savings. In warm climates, storm windows’ benefits are more limited unless they’re made of reflective glass that deflects the sun’s rays, says Adam Winter, co-founder of Recurve, a San Francisco company that does home energy audits and green remodeling.

Like replacement windows, storm windows can save you about 15% to 40% on energy bills, or from $126 to $465 a year. That’s assuming a 2,000-square-foot home with single-pane windows, according to the Efficient Windows Collaborative. Those living in colder climates should see savings closer to the top end of the range. Since storm windows are cheaper than replacement windows but the energy savings are similar, the payback period for storm windows should be a lot shorter.

When weighing storm windows vs. replacement windows, Mark Meshulam, author of the Chicago Window Expert blog, says homeowners should note that storm windows may not provide as much of a return at resale. They aren’t as attractive as full replacement windows, they’re less convenient since you need to open two windows to get fresh air, and they’re more prone to moisture problems. According to Remodeling Magazine’s 2009-10 Cost vs. Value Report, replacement windows recoup about three-fourths of their cost at resale. The magazine doesn’t track storm windows.