Form 5695 Residental Energy Credits

U.S. Individual Income Tax Return

Form 5695

U.S. Individual Income Tax Return

OMB: 1545-0074

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Form

5695

OMB No. 1545-0074

Residential Energy Credits

Department of the Treasury
Internal Revenue Service

▶

2010

▶ See instructions.
Attach to Form 1040 or Form 1040NR.

Attachment
Sequence No. 158

Name(s) shown on return

Part I
1

Your social security number

Nonbusiness Energy Property Credit (See instructions before completing this part.)

Were the qualified energy efficiency improvements or residential energy property costs for your
main home located in the United States? (see instructions) . . . . . . . . . . . .

▶

Yes

Caution: If you checked the “No” box, you cannot claim the nonbusiness energy property credit.
Do not complete Part I.
2
a

Qualified energy efficiency improvements (see instructions).
Insulation material or system specifically and primarily designed to reduce the heat loss or gain of
your home . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

b Exterior windows (including certain storm windows) and skylights . . . . . . . . . . .
c Exterior doors (including certain storm doors) . . . . . . . . . . . . . . . . . .
d Metal roof with appropriate pigmented coatings or asphalt roof with appropriate cooling granules
that are specifically and primarily designed to reduce the heat gain of your home, and the roof
meets or exceeds the Energy Star program requirements in effect at the time of purchase or
installation . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2a
2b
2c

Residential energy property costs (see instructions).
a Energy-efficient building property . . . . . . . . . . . . . . . .
b Qualified natural gas, propane, or oil furnace or hot water boiler . . . . . .
c Advanced main air circulating fan used in a natural gas, propane, or oil furnace .

.
.
.

3a
3b
3c

Add lines 2a through 3c .

Multiply line 4 by 30% (.30) .

Maximum credit amount. (If you jointly occupied the home, see instructions) .

Enter the amount, if any, from your 2009 Form 5695, line 11. Otherwise enter -0- .

Subtract line 7 from line 6

Enter the smaller of line 5 or line 8

10
11

Worksheet (see
. . . . . .
Also include this
. . . . . .

Limitation based on tax liability. Enter the amount from the Credit Limit
instructions) . . . . . . . . . . . . . . . . . . . . . . .
Nonbusiness energy property credit. Enter the smaller of line 9 or line 10.
amount on Form 1040, line 52, or Form 1040NR, line 49 . . . . . . . .

For Paperwork Reduction Act Notice, see your tax return instructions.

Cat. No. 13540P

$1,500

11
Form 5695 (2010)

Form 5695 (2010)

Part II

Page

Residential Energy Efficient Property Credit (See instructions before completing this part.)

Note. Skip lines 12 through 21 if you only have a credit carryforward from 2009.
12

Qualified solar electric property costs

Qualified solar water heating property costs

Qualified small wind energy property costs .

Qualified geothermal heat pump property costs

Add lines 12 through 15 .

Multiply line 16 by 30% (.30)

Qualified fuel cell property costs

Multiply line 18 by 30% (.30)

Kilowatt capacity of property on line 18 above ▶

Enter the smaller of line 19 or line 20 .

Credit carryforward from 2009. Enter the amount, if any, from your 2009 Form 5695, line 28

Add lines 17, 21, and 22 .

Enter the amount from Form 1040, line 46, or Form 1040NR, line 44

1040 filers: Enter the total, if any, of your credits from Form 1040,
lines 47 through 50; line 11 of this form; line 12 of the Line 11
worksheet in Pub. 972 (see instructions); Form 8396, line 9;
Form 8859, line 3; Form 8834, line 22; Form 8910, line 21;
Form 8936, line 14; and Schedule R, line 22.
1040NR filers: Enter the amount, if any, from Form 1040NR, lines
45 through 47; line 11 of this form; line 12 of the Line 11
worksheet in Pub. 972 (see instructions); Form 8396, line 9;
Form 8859, line 3; Form 8834, line 22; Form 8910, line 21; and
Form 8936, line 14.

.
.

x $1,000
.

}

Subtract line 25 from line 24. If zero or less, enter -0- here and on line 27 .

Residential energy efficient property credit. Enter the smaller of line 23 or line 26. Also include
this amount on Form 1040, line 52, or Form 1040NR, line 49 . . . . . . . . . . . . .

Credit carryforward to 2011. If line 27 is less than line 23, subtract line
27 from line 23 . . . . . . . . . . . . . . . . . . .

Form 5695 (2010)

General Instructions
Section references are to the Internal Revenue Code.

What's New
Nonbusiness energy property credit. The nonbusiness energy
property (NBEP) credit has been extended for property placed in service
in 2011. However, any NBEP credit for which you might be eligible for
NBEP improvements in 2011 may be limited, or you may be allowed no
NBEP credit at all for 2011 NBEP improvements. For 2011 NBEP
improvements, the maximum NBEP credit allowed is $500 reduced (but
not below zero) by the total of your NBEP credits for 2006 through 2010.
In addition, the credit allowed for windows for 2011 is limited to $200
reduced (but not below zero) by the total of your credits for windows
from 2006 through 2010.

Purpose of Form
Use Form 5695 to figure and take your residential energy credits. The
residential energy credits are:
• The nonbusiness energy property credit, and
• The residential energy efficient property credit.
Also use Form 5695 to take any residential energy efficient property
credit carryforward from 2009 or to carry the unused portion of the
credit to 2011.

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 2010.
Home. A home is where you lived in 2010 and can include a house,
houseboat, mobile home, cooperative apartment, condominium, and a
manufactured home that conforms to Federal Manufactured Home
Construction and Safety Standards.
You must reduce the basis of your home by the amount of any credits
allowed.
Main home. Your main home is generally the home where you live
most of the time. A temporary absence due to special circumstances,
such as illness, education, business, military service, or vacation, will
not change your main home.
Costs. For purposes of both credits, costs are treated as being paid
when the original installation of the item is completed, or in the case of
costs connected with the reconstruction of your home, when your
original use of the reconstructed home begins. For purposes of the
residential energy efficient property credit only, costs connected with
the construction of a home are treated as being paid when your original
use of the constructed home begins. If less than 80% of the use of an
item is for nonbusiness purposes, only that portion of the costs that is
allocable to the nonbusiness use can be used to determine either credit.

!
▲
CAUTION

The nonbusiness energy property credit is only available for
existing homes. Only the residential energy efficient
property credit is available for both existing homes and
homes being constructed.

Association or cooperative costs. If you are a member of a
condominium management association for a condominium you own or a
tenant-stockholder in a cooperative housing corporation, you are
treated as having paid your proportionate share of any costs of such
association or corporation.
If you received a subsidy from a public utility for the
purchase or installation of an energy conservation product
and that subsidy was not included in your gross income,
you must reduce your cost for the product by the amount
CAUTION
of that subsidy before you compute your credit. This rule
also applies if a third party (such as a contractor) receives the subsidy
on your behalf.

!
▲

Nonbusiness Energy Property Credit
You may be able to take a credit of 30% of the costs paid or incurred in
2010 for any qualified energy efficiency improvements and any
residential energy property. The credit is limited to a total of $1,500 over
tax years 2009 and 2010.
Qualified energy efficiency improvements. Qualified energy efficiency
improvements are the following building envelope components installed
on or in your main home that you owned during 2010 located in the

Page

United States if the original use of the component begins with you and
the component can be expected to remain in use at least 5 years.
• Any insulation material or system that is specifically and primarily
designed to reduce heat loss or gain of a home when installed in or on
such a home.
• Exterior windows (including certain storm windows) and skylights.
• Exterior doors (including certain storm doors).
• Any metal roof with appropriate pigmented coatings or asphalt roof
with appropriate cooling granules that are specifically and primarily
designed to reduce the heat gain of your home, and the roof meets or
exceeds the Energy Star program requirements in effect at the time of
purchase or installation.
For purposes of figuring the credit, do not include amounts paid for
the onsite preparation, assembly, or original installation of the building
envelope component.

!
▲
CAUTION

To qualify for the credit, qualified energy efficiency
improvements must meet certain energy efficiency
requirements. See Lines 2a Through 2d on page 4 for
details.

Residential energy property costs. Residential energy property costs
are costs of new qualified energy property that is installed on or in
connection with your main home that you owned during 2010 located in
the United States. Include any labor costs properly allocable to the
onsite preparation, assembly, or original installation of the energy
property. Qualified residential energy property is any of the following.
• Certain electric heat pump water heaters; electric heat pumps; central
air conditioners; natural gas, propane, or oil water heaters; and stoves
that use biomass fuel.
• Qualified natural gas, propane, or oil furnaces and qualified natural
gas, propane, or oil hot water boilers.
• Certain advanced main air circulating fans used in natural gas,
propane, or oil furnaces.

!
▲

To qualify for the credit, qualified residential energy
property must meet certain energy efficiency requirements.
See Lines 3a Through 3c that begins on page 4 for details.

CAUTION

Joint ownership of qualified property. If you and a neighbor shared
the cost of qualifying property to benefit each of your main homes, both
of you can take the nonbusiness energy property credit. You figure your
credit on the part of the cost you paid. The limit on the amount of the
credit applies to each of you separately.
Married taxpayers with more than one home. If both you and your
spouse owned and lived apart in separate main homes, the limit on the
amount of the credit applies to each of you separately. If you are filing
separate returns, both of you would complete a separate Form 5695. If
you are filing a joint return, figure your nonbusiness energy property
credit as follows.
1. Complete Part I of a separate Form 5695 for each main home
through line 5.
2. Figure the amount to be entered on line 5 of both forms (but not
more than $1,500 for each form) and enter the combined amount on line
5 of one of the forms.
3. On line 6 of the form with the combined amount on line 5, cross out
the preprinted $1,500 and enter $3,000.
4. On the dotted line to the left of line 6, enter “More than one main
home.” Then, complete the rest of this form.
5. Attach both forms to your return.
Joint occupancy. If you owned your home jointly with someone other
than your spouse, each owner must complete his or her own Form
5695. Your credit is limited to the smaller of:
1. The amount you paid, or
2. $1,500 multiplied by a fraction. The numerator is the amount you
paid and the denominator is the total amount paid by you and all other
owners.
These rules do not apply to married individuals filing a joint return.

Form 5695 (2010)

Residential Energy Efficient Property Credit
You may be able to take a credit of 30% of your costs of qualified solar
electric property, solar water heating property, small wind energy
property, geothermal heat pump property, and fuel cell property. Include
any labor costs properly allocable to the onsite preparation, assembly,
or original installation of the residential energy efficient property and for
piping or wiring to interconnect such property to the home. The credit
amount for costs paid for qualified fuel cell property is limited to $500
for each one-half kilowatt of capacity of the property.
Qualified solar electric property costs. Qualified solar electric
property costs are costs for property that uses solar energy to generate
electricity for use in your home located in the United States. This
includes costs relating to a solar panel or other property installed as a
roof or a portion of a roof. The home does not have to be your main
home.
Qualified solar water heating property costs. Qualified solar water
heating property costs are costs for property to heat water for use in
your home located in the United States if at least half of the energy used
by the solar water heating property for such purpose is derived from the
sun. This includes costs relating to a solar panel or other property
installed as a roof or a portion of a roof. To qualify for the credit, the
property must be certified for performance by the nonprofit Solar Rating
Certification Corporation or a comparable entity endorsed by the
government of the state in which the property is installed. The home
does not have to be your main home.
Qualified small wind energy property costs. Qualified small wind
energy property costs are costs for property that uses a wind turbine to
generate electricity for use in connection with your home located in the
United States. The home does not have to be your main home.
Qualified geothermal heat pump property costs. Qualified geothermal
heat pump property costs are costs for qualified geothermal heat pump
property installed on or in connection with your home located in the
United States. Qualified geothermal heat pump property is any
equipment that uses the ground or ground water as a thermal energy
source to heat your home or as a thermal energy sink to cool your
home. To qualifiy for the credit, the geothermal heat pump property
must meet the requirements of the Energy Star program that are in
effect at the time of purchase. The home does not have to be your main
home.
Qualified fuel cell property costs. Qualified fuel cell property costs are
costs for qualified fuel cell property installed on or in connection with
your main home located in the United States. Qualified fuel cell property
is an integrated system comprised of a fuel cell stack assembly and
associated balance of plant components that converts a fuel into
electricity using electrochemical means. To qualify for the credit, the fuel
cell property must have a nameplate capacity of at least one-half
kilowatt of electricity using an electrochemical process and an
electricity-only generation efficiency greater than 30%.

!
▲
CAUTION

Costs allocable to a swimming pool, hot tub, or any other
energy storage medium which has a function other than
the function of such storage do not qualify for the
residential energy efficiency credit.

Joint occupancy. If you occupied your home jointly with someone other
than your spouse, each occupant must complete his or her own Form
5695. To figure the credit, the maximum qualifying costs that can be
taken into account by all occupants for qualified fuel cell property costs
is $1,667 for each one-half kilowatt of capacity of the property. The
amount allocable to you for qualified fuel cell property costs is the lesser
of:
1. The amount you paid, or
2. The maximum qualifying cost of the property multiplied by a
fraction. The numerator is the amount you paid and the denominator is
the total amount paid by you and all other occupants.
These rules do not apply to married individuals filing a joint return.
Example. Taxpayer A owns a house with Taxpayer B where they both
reside. In 2010, they installed qualified fuel cell property at a cost of
$20,000 with a kilowatt capacity of 5. Taxpayer A paid $12,000 towards
the cost of the property and Taxpayer B paid the remaining $8,000. The
amount to be allocated is $16,670 ($1,667 x 10 (kilowatt capacity x 2)).
The amount of cost allocable to Taxpayer A is $10,002 ($16,670 x
$12,000/$20,000). The amount of cost allocable to Taxpayer B is $6,668
($16,670 x $8,000/$20,000).

Page

Specific Instructions
Part I
Lines 2a Through 2d

Nonbusiness Energy Property Credit
Before you begin Part I:
Figure the amount of any credit for the elderly or the disabled you are
claiming.

Line 1
To qualify for the credit, any qualified energy efficiency improvements or
residential energy property costs must have been for your main home
located in the United States. See Main home on page 3. If you check the
“No” box, you cannot take the nonbusiness energy property credit.
Note. Unless otherwise noted, any references to the International
Energy Conservation Code (IECC) are treated as references to the 2001
Supplement of the 2000 IECC, the 2004 Supplement of the 2003 IECC,
or the 2009 IECC. However, a reference to the 2009 IECC is a reference
only to the 2009 International Energy Conservation Code.

!
▲

Do not include on lines 2a through 2d any amounts paid for
the onsite preparation, assembly, or original installation of
the components.

CAUTION

Line 2a. Enter the amounts you paid for any insulation material or
system (including any vapor retarder or seal to limit infiltration) that is
specifically and primarily designed to reduce the heat loss or gain of
your home when installed in or on such home and meets the
prescriptive criteria established by the 2009 IECC as in effect (with
supplements) on February 17, 2009.

!
▲
CAUTION

A component is not specifically and primarily designed to
reduce the heat loss or gain of your home if it provides
structural support or a finished surface (such as drywall or
siding) or its principal purpose is to serve any function
unrelated to the reduction of heat loss or gain.

Line 2b. Enter the amounts you paid for exterior windows (including any
storm windows installed with such exterior windows) and skylights that
meet the prescriptive criteria established by the IECC for such
components and have a U-factor of 0.30 or less and a solar heat gain
coefficient (SHGC) of 0.30 or less.
Line 2c. Enter the amounts you paid for exterior doors that meet the
prescriptive criteria established by the IECC for such components and
have a U-factor of 0.30 or less and an SHGC of 0.30 or less.
Line 2d. Enter the amounts you paid for a metal roof with the
appropriate pigmented coatings or an asphalt roof with the appropriate
cooling granules that are specifically and primarily designed to reduce
the heat gain of your home, and the roof meets or exceeds the Energy
Star program requirements in effect at the time of purchase or
installation.
Manufacturer’s certification. For purposes of taking the credit, you
can rely on a manufacturer’s certification in writing that a building
envelope component is an eligible building envelope component. Do not
attach the certification to your return. Keep it for your records.

Lines 3a Through 3c

TIP

Also include on lines 3a through 3c any labor costs
properly allocable to the onsite preparation, assembly, or
original installation of the property.

Line 3a. Enter the amounts you paid for energy-efficient building
property. Energy-efficient building property is any of the following.
• An electric heat pump water heater that yields an energy factor of at
least 2.0 in the standard Department of Energy test procedure.
• An electric heat pump that achieves the highest efficiency tier
established by the Consortium for Energy Efficiency (CEE) as in effect
on January 1, 2009.
• A central air conditioner that achieves the highest efficiency tier that
has been established by the CEE as in effect on January 1, 2009.

Form 5695 (2010)

• A natural gas, propane, or oil water heater that has an energy factor of
at least 0.82 or a thermal efficiency of at least 90%.

Page

Part II

• 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% as measured by using a lower heating value. Biomass fuel is any
plant-derived fuel available on a renewable or recurring basis, including
agricultural crops and trees, wood and wood waste and residues
(including wood pellets), plants (including aquatic plants), grasses,
residues, and fibers.

Residential Energy Efficient Property Credit

Line 3b. Enter the amounts you paid for a natural gas or propane
furnace that achieves an annual fuel utilization efficiency rate of at least
95 and for a natural gas, propane, or oil hot water boiler or oil furnace
that achieves an annual fuel utilization efficiency rate of at least 90.

• District of Columbia first-time homebuyer credit.

Line 3c. Enter the amounts you paid for an advanced main air
circulating fan used in a natural gas, propane, or oil furnace that has an
annual electricity use of no more than 2% of the total annual energy use
of the furnace (as determined in the standard Department of Energy test
procedures).
Manufacturer’s certification. 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.

Line 6
If the rules on page 3 for joint occupancy apply, cross out the preprinted
$1,500 on line 6 and enter on line 6 the smaller of:
1. The amount on line 4, or
2. $1,500 multiplied by a fraction. The numerator is the amount on
line 4. The denominator is the total amount from line 4 for all owners.
For more details, see Joint occupancy on page 3.

Before you begin Part II:
Figure the amount of any of the following credits you are claiming.
• Credit for the elderly or the disabled.
• Mortgage interest credit.
• Alternative motor vehicle credit.
• Qualified plug-in electric vehicle credit.
• Qualified plug-in electric drive motor vehicle credit.

TIP

Also include on lines 12 through 15, and 18, any labor
costs properly allocable to the onsite preparation,
assembly, or original installation of the property and for
piping or wiring to interconnect such property to the home.

Line 12
Enter the amounts you paid for qualified solar electric property. See
Qualified solar electric property costs on page 4.

Line 13
Enter the amounts you paid for qualified solar water heating property.
See Qualified solar water heating property costs on page 4.

Line 14
Enter the amounts you paid for qualified small wind energy property.
See Qualified small wind energy property costs on page 4.

Line 15

Line 10

Enter the amounts you paid for qualified geothermal heat pump
property. See Qualified geothermal heat pump property costs on page 4.

Complete the worksheet below to figure the amount to enter on line 10.

Line 18

Credit Limit Worksheet—Line 10

Enter the amounts you paid for qualified fuel cell property. See Qualified
fuel cell property costs on page 4.

1. Enter the amount from Form 1040, line 46, or
Form 1040NR, line 44 . . . . . . .
1.
2. Enter the total, if any, of your credits from Form
1040, lines 47 through 50, and Schedule R, line
22; or Form 1040NR, lines 45 through 47 .
2.
3. Subtract line 2 from line 1. Also enter this
amount on Form 5695, line 10. If zero or less,
stop; you cannot take the nonbusiness energy
property credit . . . . . . . . .
3.

Line 25
If you are claiming the child tax credit for 2010, include on this line the
amount from line 12 of the Line 11 Worksheet in Pub. 972.

TIP

If you are not claiming the child tax credit for 2010, you do
not need Pub. 972.

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

Line 28
If you cannot use all of the credit because of the tax liability limit (line 26
is less than line 23), you can carry the unused portion of the credit to
2011.
File this form even if you cannot use any of your credit in 2010.

File Type	application/pdf
File Title	2010 Form 5695
Subject	Fillable
Author	SE:W:CAR:MP
File Modified	2011-01-06
File Created	2009-06-05