There’s still time to take advantage of tax credits for energy efficient home upgrades.
Tax Credits Versus Tax Deductions: Deductions reduce your taxable income while credits reduce the amount of tax you owe. Tax credits give you a bit more bang for the buck!
Here is the equipment eligible for HVAC tax credits:
- $150 for gas, propane, or oil furnaces with annualized fuel usage efficiency (AFUE) of at least 95 percent.
- $150 for gas, propane, or oil boilers with an AFUE of at least 95 percent.
- $300 for a air conditioning and heat pump systems that include split systems (AC must be at least 16 SEER, 13 EER and the heat pump must be at least 15 SEER, 12.5 EER and 8.5 HSPF) and packaged systems (AC must be at least 14 SEER, 12 EER and heat pump must be at least 14 SEER, 12 EER, 8.0 HSPF)
- $50 for an advanced main circulating (blower) fan.
- $300 for electric water heaters with an energy factor of 2.0 or higher.
- $300 for gas, propane, or oil water heaters with an energy factor of at least .82 or an energy efficiency of at least 90 percent.
Please note that there is a $500 cap on the credits a single household can receive.
Alternative Energy: There are HVAC systems on the market that use alternative energy, like solar or geothermal, to heat and cool the home. Homeowners with these systems can take advantage of a 30 percent tax credit on the system with no cap.
IRS Information:This information is also available in section 25C of the Internal Revenue Code. You may also consult a tax professional for more information.To receive any of the above tax credits, complete IRS form 5695 and submit with your taxes.