If my homeowner's insurance was used to replace a roof and they installed GAF Timberline HDZ shingles that qualify as energy efficient can I claim a tax credit?

For purposes of calculating the energy tax credit for 2023, you can use the amount you paid for qualifying property.

 

To enter your information for the 2023 Residential Clean Energy Credit and the Energy Efficient Home Improvement Credit, in TurboTax Online:

 

1. Open or continue your return, if you don't already have it open.
2. Select the Deductions & Credits tab.
3. Find the Your Home section.
4. Select the Start/Revisit button for Home Energy Credits.
5. On the Energy-Saving Home Improvements screen, answer Yes and Continue. Follow the instructions on the next screens.
   • The first part of the interview covers improvements like doors, windows, furnace, air conditioning, and heat pumps. If you're looking for other improvements like solar, geothermal, wind, and fuel cell, just keep going and TurboTax will ask about those as well.

 

Installing a roof doesn't automatically qualify for the Residential Clean Energy Credit. However, if you invest in certain types of solar roofing equipment like solar roofing tiles and shingles which serve as both a form of solar electric generation and traditional roofing, or as insulation, such investments can qualify for the credit.

 

Roofs (Metal and Asphalt)  - a credit of 30% up to the applicable limit is available for roofing materials that meet the requirements and have the proper pigmented coatings and cooling granules. This credit does not cover installation costs.

 

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, battery storage technology, and fuel cell property. Include any labor costs properly allocable to the onsite preparation, assembly, or original installation of the residential clean energy 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 are costs for property that uses solar energy to generate electricity for use in your home located in the United States. No costs relating to a solar panel or other property installed as a roof (or portion thereof) will fail to qualify solely because the property constitutes a structural component of the structure on which it is installed. 

 

Some solar roofing tiles and solar roofing shingles serve the function of both traditional roofing and solar electric collectors and thus serve functions of both solar electric generation and structural support. These solar roofing tiles and solar roofing shingles can qualify for the credit. This is in contrast to structural components such as a roof's decking or rafters that serve only a roofing or structural function and thus do not qualify for the credit.

 

See the IRS Instructions for Form 5695 and this TurboTax help article for more information.

 

The insurance payment may affect your cost basis in your home. For example, replacing an entire roof is considered an improvement, and the cost will increase the basis of the home. However, the part of the cost paid or reimbursed by an insurance claim is not added to the home's basis.