Good news! The purchase of high-efficiency heating and cooling equipment this year could mean big savings up to $500 when you file your taxes next year!
How?
Energy Star is partnering with the federal government to provide incentives to anyone who buys high-efficiency heating and cooling equipment.
Why?
Because it’s better for the environment, and so you’re getting rewarded for the reduced energy output of your home!
When?
If you want to take advantage of the tax credits, for the most part you will need to invest in new heating and cooling equipment before the end of 2021. That way, you can claim the purchase and receive the tax credits when you file your 2021 taxes.
Now, this program has a chance of getting renewed in the future, so that you may be able to get tax credits for high-efficiency heating and cooling purchases made in 2022 or beyond, but there is no guarantee a renewal. So, for now, purchasing new equipment this year is the only way to guarantee eligibility for the tax credits, if you don’t have new equipment already.
Any equipment purchased between December 31st, 2017, and December 31st, 2021, is eligible, as long as it meets the energy efficiency requirements.
(For equipment purchased before 2021, ask a tax professional about an amended tax return.)
How do I get the $500 tax credit?
We’re betting this is the question you were waiting to get an answer to!
However, there are a couple things you should know first. In addition to the rule about purchases only being eligible if made from December 31st, 2017, to December 31st, 2021, there is another rule as well. Namely that the home you are claiming credit for must be your primary home. So unfortunately, vacation home purchases don’t count.
In order to find out the exact amount you’ll get for different systems, visit the Energy Star website. However, we will give you a couple of examples to show how large of a tax credit you could receive:
- Gas furnaces – $150
(AFUE greater than or equal to 95)
- A/C system – $300
(SEER greater than or equal to 14)
- Insulation – 10% of cost up to $500
These tax credits are easy to get, now that the deadline has been extended, allowing you to purchase qualifying equipment before the end of the 2021. Save money not only through the tax credits, but also because of the energy you save when you buy high-efficiency heating and cooling systems. To learn more, just contact us online or give us a call: (714) 602-1299