Uncle Sam wants to help pay for costs of installing energy conservation devices on your principal residence, whether you own or rent it.

This help comes in the form of a tax credit against the amount of income tax you owe. In addition, many states allow credit or itemized deductions for the same energy conservation expenses.

Depending on the type of energy conservation device installed, taxpayers can qualify for federal income tax savings.

(1) Installation of conservation-type devices gives tax credits of 15 percent of the cost, up to a maximum $300 tax credit in this category. Examples of qualifying conservation items at your principal residence include (a) insulation for walls, floors, and ceilings, (b) new energy-efficient furnace burners, (c) storm or thermal windows and doors, (d) automatic clock thermostats, (e) exterior door and window caulking or weatherstripping, and (f) electrical or mechanical devices replacing gas pilot lights. Qualifying equipment must be new and have at least a three-year expected life.

(2) Devices that transmit solar, geothermal or wind energy (so-called renewable energy sources) qualify for bigger tax credits of 30 percent of the first $2,000 plus 20 percent of the next $8,000 of costs. This tax credit is available in addition to the conservation credit above. Examples of qualifying devices include solar water heaters and windmills to pump water. $2,200 is the maximum tax credit in this category. The equipment must be new and must have an expected useful life of at least five years.

Taxpayers sometimes think certain non-qualifying items are eligible for the energy tax credit. Items which do not qualify include new carpets, drapes, heat pumps, fluorescent lights, swimming pool conservation devices, wood-burning stoves, replacement boilers and furnaces, wood paneling, and exterior house siding.

The Energy Tax Credit should be claimed on IRS Form 5695 filed with your 1979 income tax returns. These tax credits apply only to your personal residence, not to vacation or second homes or to investment property. However, energy conservation devices installed on property other than your principal residence may qualify for the energy tax credit for business, discussed below.

The maximum limits are cumulative,not annual, so any Energy Tax Credit claimed on your 1978 tax return may affect your allowable credit on your 1979 tax returns for the same principal residence.