Yet I've seen discussion web-sites that definitively say this is for existing home improvements only, not new construction. And I've seen forums where professional tax preparers disagree.

We owned the lot and paid every step of the way from a personal construction loan, so the builder was not able to take any tax credits. So if the wording on this is an attemp to prevent both builders and owners to both take a tax credit, that doesn't apply here. But that probably doesn't matter to the IRS.

I don't want to miss a credit, but am fearful of being stung on an audit.

However, the tax credit for photovoltaics, solar water heating, and fuel cells is available for homeowners building new homes.

There is a $2,000 tax credit for building a new energy efficient home, but it is only available to "eligible contractors"; therefore, owner/builders may not receive the builder tax credit unless employed as eligible contractors.

Form 5695 is for individual consumers, and where the text reads "... or in the case of costs connected with the construction...".

What you have told me is consistant with what I've read elsewhere, but you can probably see why both I and others have been confused. Poor choice of wording by the IRS.

So, the house was 'constructed' in 2006/2007 and we started using in in 2007. How does that not fit the criteria above?