Feb 10, 2013
First, the tax credit for qualifying renewable energy appliances has been reinstated for 2013. You can find out all the details of this additional savings here.
Next, Magnum Countryside and Country Flame heating appliances are high efficient heat sources, utilizing the latest technology to get the most out of each of your dollars. When you heat with renewable energy and have multiple choices, the savings is quite astounding. You can calculate your savings here.
And, American Energy Systems offers half off of shipping, so you can save even more money. We also provide a free guide that will help you make the most economical choice in appliance, as well as a decision on what is right for YOU! You can request your free guide now and get on our mailing list for other Great Discounts.
Jan 9, 2013
On January 2, 2013, President Obama signed the American Taxpayer Relief Act of 2012 (H.R.8) which extended the 2010/2011 tax credit for 2012/2013
$300 Biomass Stove Tax Credit Reinstated for 2012 – 2013
A federal tax credit on 75 percent efficient biomass heating appliances, which expired on December 31, 2011, was reinstated by the “fiscal cliff” legislation, the American Taxpayer Relief Act of 2012 (H.R. 8), signed by President Obama on January 2, 2013. The bill includes a “tax extender” for Internal Revenue Service Section 25C which provides a tax credit for, among many other things, qualifying biomass burning stoves. The extender provides a 10 percent tax credit of up to $300 on a qualifying biomass heating appliance purchased between January 1, 2012 and December 31, 2013. The credit claimable on the purchase or installation of qualifying biomass units is limited to a “lifetime limit” of $500 (and may be impacted by the purchase or installation of other products that qualify of a 25C credit).
You will need to maintain a copy of the Manufacturer’s Certificate which can be downloaded from our website
“PLEASE CONSULT YOUR TAX ADVISER FOR DETAILS OF HOW THIS WILL EFFECT YOU”
History and Background on the Biomass Stove Tax Credit
2008 – At the end of 2008, in the last days of the 110th Congress, HPBA succeeded in having inserted, in a major financial bailout measure, language that provided a 10% tax credit (up to $300) for consumers who purchased a 75% efficient stove “which uses the burning of biomass fuel to heat a dwelling unit…or to heat hot water for use in such a dwelling unit.” A definition of biomass fuel was also included in the language of the bill.
The concept of using the lower heating value (LHV) method, and not the higher heating value (HHV) method, to measure efficiency was not mentioned in the final language of that legislation (H.R. 1424 – Public Law No. 110-343). After passage, a determination was made that without language indicating whether to use HHV or LHV, there would be major confusion among manufacturers about which method (and therefore which efficiency number) to use. Such manufacturer confusion would translate into marketplace (i.e., consumer) confusion.
Following enactment of the 10% tax credit measure, discussions began within HPBA on the fact that using the HHV method (vs. LHV) to determine efficiency would severely reduce the number of units that would qualify for the tax credit.
An effort was immediately begun to get enacted language to specifically list LHV as the efficiency measuring method.
2009 – In early 2009, the new Obama Administration and the new 111th Congress proposed the massive stimulus package, The American Recovery and Reinvestment Act (ARRA) of 2009. Working with our allies in the Congress, HPBA was able to get language inserted into the ARRA draft language that expanded the 2008-passed tax credit to become a 2-year credit with the same requirements (75% efficiency), but with a much-increased value for the tax credit (30%, up to $1500). Lastly, and very importantly, HPBA was able to get language inserted that requires the use of “a thermal efficiency rating of at least 75 % as measured using a lower heating value.” The LHV language was key to ensuring that the biomass-burning stove tax credit would be a success.
2010/2011 – The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act TRUIRJCA of 2010, passed at the end of 2010, took the numbers of the biomass-burning stove tax credit back to its pre-2009 levels:
- Tax credit of 10% of purchase price (not to include installation), up to a maximum credit of $300
- Applicable for purchases in 2011 only
- Kept the 75% efficiency level because it referenced the prior credit and did not explicitly (or implicitly) remove the 75% number
- Explicitly removed the Low Heating Value (LHV) testing methodology from TRUIRJCA at Sec. 710(b)(2)(B) but did not mention any substitute method.
In the weeks leading up to Congress’ vote on the tax package, HPBA reached out to congressional leaders to remind them of the importance of this tax credit not only to the hearth industry but to consumers interested in purchasing biomass heating systems. HPBA had been working closely with Senator Susan Collins (R-ME) to ensure that biomass tax credit language was contained in the bill, and we are appreciative of the efforts she put forth in achieving its inclusion. Of particular note is Sen. Collins’ inclusion of language in the Congressional Record (the official transcript of the United States Congress) that directs the IRS to continue to use the lower heating value as the operative efficiency methodology in determining which appliance qualifies for the tax credit. A portion of her remarks stated:
“The IRS has issued guidance directing that the ‘lower heating value’ methodology should be used, which is consistent with industry practices and with our intent to ensure that the credit is available for efficient and clean-burning wood and wood-pellet stoves. Removing the reference to the ‘lower heating value’ from the Code serves little purpose. Certainly, however, it does not mean that this common-sense methodology is precluded, nor does it require the IRS to revisit its methodology. I hope that my comments today will help avoid confusion about the use of the ‘lower heating value’ methodology with respect to this tax credit.”
(Congressional Record, December 15, 2010; Statement by Senator Susan M. Collins; H.R. 4853, Middle Class Tax Relief Act of 2010)
Comments placed in the Congressional Record have no authority to direct or alter regulations or legislation, but they do have the power to suggest how bureaucrats might want to interpret congressional actions. With this in mind, and without any absolute indication to the contrary, HPBA is continuing to suggest that the 75% efficiency level still applies. And, although the very important LHV measurement language has been deleted, we believe (but do not yet know for certain) that the IRS will continue to follow the precedent set by the prior tax credit and allow the use of the LHV measurement to determine efficiency. We are in the process of asking the committees of jurisdiction in the new 112th Congress for a more detailed explanation of why LHV was removed from the tax code, and what we can do to get it permanently returned to the code.
2012/2013 – On January 2, 2013, President Obama signed the American Taxpayer Relief Act of 2012 (H.R.8) which extended the 2010/2011 tax credit for 2012/2013
Lifetime Limitation – The tax code is famous for its “lifetime limitation” language and this tax credit is no different. As with historical tax credits available to the industry, rather than attempting to explain the complicated details of lifetime limitations, HPBA prefers to say, “PLEASE CONSULT YOUR TAX ADVISOR FOR DETAILS OF HOW THIS WILL AFFECT YOU” in all of our comments, both written and oral, about this credit.
Tax Credit FAQs
What is the Biomass-Burning Stove Tax Credit?
This federal tax credit encourages people to make energy-conscious purchases that improve the energy efficiency of their home. It is an up to $300 credit you can get for buying a qualifying biomass-burning stove or fireplace insert between January 1, 2012 and December 31, 2013. Biomass simply means the stove uses wood or pellet fuel.
Consumers claim the credit on their federal income tax form at the end of the year. This new credit reduces the amount of tax you owe. The new credit is a reduction of total income tax at the bottom of your return, up to $1500. This tax credit is a non-refundable tax credit available for individuals who pay taxes and who make energy-conscious purchases to improve the energy efficiency of their home.
Note: With regard to tax credits vs. tax deductions, in general, a tax credit is more valuable than a similar tax deduction. A tax credit reduces the tax you pay, dollar-for-dollar. Tax deductions – such as those for home mortgages and charitable giving – lower your taxable income.
What is the difference between a tax deduction and a tax credit?
As previously stated, a deduction is an expense or amount you can subtract from your taxable income. A tax credit lowers your actual tax bill dollar-for-dollar, in this case by up to $1,500. In general, a tax credit is more valuable than a similar tax deduction.
What is the difference between a non-refundable tax credit and refundable tax credit?
A non-refundable tax credit (such as this one) is a tax credit that is applied to the amount of tax owed by the taxpayer after all deductions are made from his or her taxable income. Typically, a tax credit only reduces an individual’s tax liability to zero. Refundable credits can be considered the same as a payment, with no limit to the amount a taxpayer can receive. A refundable tax credit is a tax credit that is not limited by the amount of an individual’s tax liability.
When does this tax credit go into effect and how long will it last?
The tax credit went into effect January 1, 2009 and is valid only for the purchase of a qualifying biomass stove during 2009 and 2010. The maximum tax credit for the two-year period is $1500. The sales receipt must indicate that the purchase was made between January 1, 2009 and December 31, 2010.
How is the value of this tax credit determined?
When you buy a qualifying biomass-burning appliance between January 1, 2009 and December 31, 2010, you get a tax credit of 30% of the total price, up to $1,500 dollars. So, for example, if your wood or pellet stove cost $5,000 (which can include installation), you can deduct $1,500 from the taxes you owe the government.
What appliances qualify for the tax credit?
Any wood- or pellet-burning stove that meets the 75% efficiency rating qualifies for this credit.
Manufacturers test their products to certify they meet this efficiency standard and the IRS-required certification will come with the product straight from the appliance manufacturer. who can explain which products they have will qualify for the tax credit.
Why was 75% efficiency selected?
The 75% efficiency was designated by the U.S. Congress in 2005 as part of the Energy Policy Act and was used again for this tax credit.Are biomass stoves installed in new or vacation homes covered by this tax credit?
How is the 75% efficiency requirement determined?
The manufacturer of the stove must provide certification that the product tests for at least a 75% efficiency rating using the lower heating value, i.e., the heat value of a combustion process assuming that none of the water vapor resulting from the process is condensed out, so that its latent heat is not available.
Are biomass stoves installed in new or vacation homes covered by this tax credit?
No. The credit only applies to your existing principal residence. New homes and vacation homes don’t qualify, nor do homes owned as rental units. The IRS is very clear that this credit applies only to existing principal residences, thus new homes and vacation homes would not qualify, nor would homes owned as rental units.
What is meant by “renewable biomass?”
For the purposes of this tax credit, the term ‘renewable biomass’ means any of the following:
(A) Materials, pre-commercial thinnings, or removed invasive species from National Forest System land and public lands, including those that are byproducts of preventive treatments (such as trees, wood, brush, thinnings, chips, and slash), that are removed as part of a federally recognized timber sale, or that are removed to reduce hazardous fuels, to reduce or contain disease or insect infestation, or to restore ecosystem health, and that are harvested in environmentally sustainable quantities, as determined by the appropriate federal land manager; and harvested in accordance with federal and state law, and applicable land management plans.
(B) Any organic matter that is available on a renewable or recurring basis from non-federal land or land belonging to an Indian or Indian Tribe that is held in trust by the United States, including renewable plant material like feed grains; other agricultural commodities; other plants and trees; and algae; and waste material, including crop residue; other vegetative waste material (including wood waste and wood residues); animal waste and byproducts (including fats, oils, greases, and manure); construction waste; and food waste and yard waste.
(C) Residues and byproducts from wood, pulp, or paper products facilities.
What is the definition of a “Wood Burning Furnace?”
A wood burning furnace is a simply a furnace type that uses wood as its primary fuel source. In some cases, a wood furnace can simply use radiant heat in order to control environmental conditions in the home, or it can be a forced-air furnace. Forced-air furnaces force air into the furnace, heat it up, and then force the heated air into the ducts for distribution throughout the home. This is also known as central heating.
Will other wood and solid-fuel appliances (like inserts, EPA-certified wood-burning fireplaces and hydronic heaters) qualify for the tax credit?
The IRS did not state that inserts are covered, or are not covered. However, based on EPA’s practice of treating inserts and freestanding biomass stoves in a similar fashion, manufacturers may choose to include inserts. At this time (June 2009) it is not clear whether EPA-certified wood-burning fireplaces or hydronic heaters will qualify.
How do I ensure that I can collect on my tax credit?
Save your receipt that proves you purchased the qualifying appliance between January 1, 2009 and December 31, 2010. You’ll also need a manufacturer’s certification statement that states your product meets the 75% efficiency rating needed to qualify for this tax credit.
A manufacturer’s certification statement must contain the following information:
These documents don’t need to be attached to your tax return, but you should keep them for your records. Click here to download the MagnuM or Country Flame certificate.
What should a retailer provide and the customer retain for tax purposes?
Retailers and consumers must keep exact records of any sale or purchase. Retailers should provide a consumer with the manufacturer’s certification statement for the specific product model purchased. A consumer may rely on a manufacturer’s certification statement that their products are qualified energy property. A taxpayer is not required to attach the certification statement to the return on which the credit is claimed. A consumer claiming a credit for qualified energy property should retain the certification statement as part of the taxpayer’s records. Manufacturers should make this certification document available to consumers on the web, in the product packaging, or in some other easily accessible manner.
Are installation costs included in this tax credit?
Yes. Installation costs are included as long as professional installation is required for the proper and safe operation of the stove. The IRS is silent on the possible need to replace a chimney when upgrading an existing biomass stove; however, the EPA has a section on its website titled, Installation Effects Efficiency, which retailers and consumers should consult when deciding if a chimney replacement is warranted when installing a biomass stove.
Does the stove need to be manufactured in the U.S. to qualify for the credit?
No. There is no “Buy America” component to this tax credit.
Where can I find more information about this tax credit?
You can check out the IRS’s description.
Hearth Patio & Barbecue Association
Still have questions or want to talk to use about purchasing a qualifying unit right away? Call us at American Energy Systems at 1-800-495-3196. We are currently offering to pick up half the cost of shipping to help save you even more money!
Dec 18, 2012
Consumer consciences have inflated enormously in recent years, with 80 percent of home owners consciously shrinking their carbon footprints. The public is still reeling after the recent recession, but that isn’t dampening its appetite for sparkling new decor. Contemporary property owners are unwilling to make sacrifices: interior decorating and home comfort needs are at their peak even as budgets are harshly whittled down. To win the best of all worlds, tactical approaches to home improvement are solving cash-shy budget problems. Government incentives are only making these strategies simpler. When stainless steel appliances need to be upgraded to trendy white ice, and a temperature perfect household demands a spanking new heating system, good planning helps address budgeting issues. All it takes is a little tactical thinking.
Property investors make great claims about their reasons for choosing Energy Star items, but saving money is at the forefront of most motives. There can be rewards for going green, sometimes from the local, state, or federal government. In return for your eco-friendly commitment, you receive featherweight utility bills. An energy efficient refrigerator can chop 40 percent off your monthly expenses, whilst Energy Star ranked dishwashers deliver you the same power savings together with half the water consumption. Various appliances comes with different rebates. Buying a pellet stove or other highly efficient heating appliance from American Energy Systems not only saves you in heat efficiency, but can land you various amounts in reimbursements (or low interest home loans) depending on programs available in your area. Check with your local city or county, and watch local publications such as this one that announced special savings for people in Maryland on pellet stoves.
Today’s homemakers are turning to investment as a way of indirectly saving money, and in so doing, are giving their cash more potency. Kitchen upgrades can yield upwards of 85% profit. Temperature perfect homes win higher resale value. Just look at all the property listings that showcase pellet stoves or fireplaces as a selling point! When upgrading appliances, differentiating between cost and value gives you an estimate of your less immediate financial gains, which let you stretch your budget further. Instant gratification is not a worthy goal in tactical monetary management strategy.
Old fashioned frugality is not a tool to be sniffed at. Scrooge would have bought the water heater with the scratch, and he’d have made an excellent financial point while doing so. The half price shipping we offer on purchases is a result of our reaching out to home owners and helping offset some costs. We want to help you fit a pellet stove, fireplace or furnace into your budget when you’ve determined it’s what you want to do.
Sep 14, 2012
While weather is still moderate and fuel suppliers are gearing up with inventory, you should consider your options available.
- People living in multi-level homes can switch to renewable energy!
- People living in old farm homes with ancient furnaces can switch to renewable energy!
- People living in the city can switch to renewable energy!
- People living in a mobile or modular home can switch to renewable energy!
- People living in the coldest of United States areas can switch to renewable energy!
- People remodeling or building a new home can begin with renewable energy!
- People who need to heat a shop or business can switch to renewable energy!
What kind of renewable energy is right for you and your home? The best place to start is this resource: Free Guide to Finding the Best Renewable Energy Appliance. You can also call our experienced heating specialists to ask questions, discuss your concerns, and make sure you get the best appliance for your needs. Call 1-800-495-3196
May 3, 2012
Saving money is critical to most Americans and the rising price of oil is very concerning. Where will oil prices go in 2012? What will we be looking at for heating costs in only a few short months? Even though Spring is here and warm temps have us breathing a sigh of relief, we know that another winter will be here before we know it and planning is imperative.
So how much can you save on fuel for a pellet stove?
What is the least expensive fuel to use?
Your fuel costs are often determined by where you live, rather than the fuel itself. Sometimes corn will be less expensive than wood pellets and then the opposite may be the case. For those who grow renewable fuel or have it readily available, it can mean even more cost savings. It is best to determine first what the most reliable fuel source is and then negotiate the best price. Corn is usually the best overall bargain (it burns hotter) and is usually available anywhere in the country. Wood pellets are normally the most convenient, but a variety of renewable fuel centers are springing up around the country making all fuels convenient and available. It is nice to know that companies like American Energy Systems make Stoves that will burn a variety of fuels instead of just Wood Pellets.
You can compare fuel and find out the national averages of each fuel cost. Finding out the best fuel source is a step toward determining the best heating appliance for your home too; get your free guide today.
Feb 15, 2012
You can check our list of current items posted online in our second hand and close out section. Availability of these items changes frequently, and it is very important that you verify that your model is listed under the part before purchasing.
Feb 1, 2012
There are areas of the country where customers are using the MagnuM Pellet Stoves off of the grid; Western Montana and Arizona to mention a couple. The Forest Service in Montana is using our model BC-DC up in the mountains where there is no power. The MagnuM DC powered units are very frugal on power usage so they make a perfect application for wind power, solar and battery operation. There are several companies that provide small wind and solar units for small usage products like this or you can tap into your whole house system. The appliance requires a constant 14 volt with a solid 5 amps of current. Proper filters must be installed in the system to prevent voltage surges and variances in volts and cycles. The wind or solar generator companies can help with that.
The only problems that we have seen thus far is if the wind, solar or battery system does not provide a constant 14 volt input. This is easily rectified by having adequate battery storage and voltage stabilizers in the system. If the battery volts drop below 9 volts, the unit will automatically shut down. If you are on only battery power, the self ignition system will not work and you need to light the stove manually. This is a great way to heat off the grid and save precious energy.
Are you using your stove off the grid? Have you utilized solar, wind or battery systems instead of electricity to power your stove? We’d love to hear from you!
Dec 6, 2011
Dear American Energy Systems,
The years have gone by, and I have had the same results every time so I wanted to share them with your company. I am heating approximately 4500 sq feet of office space and warehouse.
Another heating season is starting, and I am very happy to inform you that I just had another flawless start up of both my heating units. I have an old 6500 furnace along with a baby corn stove. I am an extremely busy person, and maintenance is not one of my strong points. I am scared to confess that the past few years I have neglected to clean them after the heating season ended. In fact, I simply let the corn/wood pellets run out, the unit turned off, and that’s the way I left them all summer until just today. After a lot of vacuuming with my ash vac, I filled it, started it, and let them take off. These things are unbelievable. So, I simply wanted you to have my thanks for building such a solid unit, that even I can run it.
Ps, I will try to do a better job servicing my units this year. I want them to continuing saving me boat loads of money. One more thing: with natural gas it was costing up to $1000 a month to heat my office area. Now, it takes a pallet of corn which runs around $300 a month. HUGE savings there. Thank you very much for helping me buy my snow mobiles.
Jul 14, 2011
If you are in the market for a renewable energy appliance, such as a wood pellet stove, corn stove or fireplace, wood burning fireplace, or flex-fuel furnace, we are currently offering half-price shipping for a substantial savings.
But hurry, this offer won’t last.
Order today and have your appliance installed and ready to go before this fall!
Don’t know what appliance is right for you? Get our “Free Guide to Finding a Renewable Energy Appliance”.
Jun 16, 2011
- Get a smart thermostat- Many thermostats have timers built in that will let you schedule days and times when the air conditioning is on. For instance, you can set it to keep your home cooler on a weekend, or not running while you are gone. They key is to regulate the temperature so it saves you money.
- Keep it moving with ceiling fans – Remember, warm air rises to the top and cold air settles on the bottom. So in the summer time, make sure your ceiling fans are set to run so they turn clockwise (this looks counterclockwise as you are looking up). This will cause a nice downward draft and make you feel cooler and evaporate sweat.
- Block the sun- When rooms are not in use, keep blinds or shades pulled so that the sun does not heat the room through windows or doors. If you are considering buying new windows, make sure to get windows with low-e (low-emissivity) window glass to reduce the heat that enters your home. There are also some window tinting kits that could have the same effect. Low-e coatings are equivalent to adding another pane of glass and can reduce solar heat gain by 25-55% during the cooling season.
- Go outside instead – Instead of starting the oven or throwing your clothes in the clothes dryer, grill outside or hang your laundry on the clothes line. This will save you money from using your appliances, and adding un-wanted heat to your home.
- Be cool, but not too cool- Keep your air conditioner maintained and change the filter as directed. If possible, get an energy efficient air conditioner that is the appropriate size for your room or home. Resist the temptation to set the air cooler than 78 degrees.
- Reduce humidity- Take cooler showers and be sure to turn on the exhaust fan in the bathroom. When humidity is a factor, some people may turn on the dehumidifier instead of their air conditioning.
Lastly, go outside, and have a cool lemonade or sit by the pool to enjoy the weather. We will be talking about cold winters and corn stove heating options again before you know it!
What other ideas do you have for saving money on air conditioning and staying cool this summer?