The additional insulation may qualify for the Nonbusiness Energy Property Tax Credit, but vinyl siding is not on the list of qualifying improvements - and you must have written certification from the manufacturer that the insulation meets the standards to claim this credit.
From the IRS Get Credit for Making a Home Energy Efficient:
Part of this credit is worth 10 percent of the cost of certain qualified energy-saving items added to a taxpayer’s main home last year. Qualified improvements include adding insulation, energy-efficient exterior windows and doors, and certain roofs. Do not include the cost to install these items.
Be sure to have the written certification from the manufacturer that their product qualifies for this tax credit. They usually post it on their website or include it with the product’s packaging. Taxpayers can use this to claim the credit. Do not attach it to a tax return. Keep it with tax records.
