If your home’s windows and skylights are old and drafty, it may be time to replace them with new, much more energy efficient products. By installing ENERGY STAR® labeled windows and skylights (made by several manufacturers), you can take advantage of the 2010 U.S. federal tax credits that have been set up to offer you an incentive and financial support for making this important energy-saving home improvement.

What is covered? An exterior window or skylight that is ENERGY STAR® labeled or meets or exceeds the prescriptive criteria established by the IECC for the climate zone in which it is installed. It must be installed in your principal residence--that is, the home where you live most of the time. That home may be a house, mobile home, manufactured home, coop, condo, or even a houseboat. Windows and skylights may either replace older models or be installed in new locations, such as a home addition.

Amount of federal tax credit: 30% of the material cost, up to $1,500. Installation costs are not included.

Notes: The material must be placed into service between January 1, 2009, and December 31, 2010. Windows and skylights placed in service between June 1, 2009 and December 31, 2010 must have a U-factor and solar Heat Gain Coefficient (SHGC) less than or equal to 0.30. A Manufacturer’s Certification (a statement from the manufacturer certifying that the product qualifies for the tax credit), which is often available from the manufacturer’s Web site, should be kept in your records along with your receipt. When filing your federal tax return, submit IRS Tax Form 5695.