There may be only a few weeks left in 2016, but you still have time to take advantage of several federal income tax credits that are available for qualified HVAC equipment purchases. The following information gives you a brief explanation of those credits and what qualifies for them.
Tax Credit Basics
Federal income tax credits for energy efficiency are available to offset the costs of certain HVAC systems and efficiency-boosting construction. The credits can be applied directly to your income taxes. You can apply the credits to purchases made in either 2015 or 2016. Remember, the credits will expire on December 31, 2016.
Consult with your tax professional for details on limitations and applications.
Tax Credit Facts
The tax credits qualify only for an existing principal place of residence. You can’t use these credits if the equipment is purchased for a rental unit or new construction, such as for a second home. Credits range from 10 percent of the cost of the equipment, up to $500, or for a specified amount between $50 and $300.
- Central air conditioning (both split and package systems): $300 credit.
- Air source heat pumps (both split and package systems): $300 credit.
- Gas, propane, or oil furnaces and fans: $150 for furnace, $50 for advanced main air circulating fan.
- Non-solar water heaters: $300 credit.
- Geothermal heat pumps: 30 percent credit, including installation.
- Insulation (dot not include installation): 10 percent of cost up to $500.
- Roofs (metal and asphalt roofs with coatings designed to reduce heat gain): 10 percent of cost.
- Windows and doors: 10 percent of cost up to $200 for windows and $500 for doors.
State Tax Credits
Your HVAC purchase may also be eligible for state-level tax credits or efficiency incentives. Check the Database of State Incentives for Renewables and Efficiency(DSIRE) for California to see what qualifies.
Sherlock Plumbing, Heating & Air provides expert HVAC and indoor air quality services to customers in San Diego and the neighboring cities. Contact us today for more information on energy-efficiency tax credits and for the equipment you need to qualify.