If you've been considering upgrading or replacing some of your HVAC equipment, it's a good idea to do it before the end of 2016. The purchase of certain types of HVAC systems or energy-efficient building features can qualify you for substantial federal income tax credits.
TAX CREDIT OVERVIEW
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 they 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. These credits do not apply if the equipment is purchased for a rental unit or new construction, such as for a second home. Credits are for 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
You 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.
Visit our website for in-depth information on most HVAC topics, or just give us a call at (408) 868-5500. We’ve been serving the South Bay Peninsula and Santa Cruz for more than 40 years and can help you find and install the HVAC equipment you need to qualify for 2016's federal income tax credits.
Our goal is to help educate our customers in the greater San Diego and San Marcos, California area about energy and home comfort issues (specific to HVAC systems).