When the Congress passed legislation to avoid the fiscal cliff, it also resurrected the tax credit for installing energy-efficient heating and cooling equipment. The credit covers qualifying equipment purchased and installed from January 1, 2012, through December 31, 2013. The type of equipment and the minimum efficiency standards they must have include:
Furnaces and boilers. These appliances must have a 95 percent AFUE (annual fuel utilization efficiency). The current minimum for combustion furnaces is 78 percent AFUE, which means that they waste 22 percent of the fuel they consume. A 95 percent efficiency furnace wastes just 5 percent of the fuel, which lowers consumption substantially.
Heat pumps. The minimum SEER for qualifying heat pumps is 15 and the minimum HSPF (heating seasonal performance factor) has to be 8.5 or higher to qualify for the tax credit.
Air conditioners. Package air conditioners must have a minimum SEER (seasonal energy efficiency ratio) rating of 14. A package system is one that combines the heating and cooling in a single unit and is located either on the roof or in the yard. A split-system air conditioner must have a SEER of at least 16. The current minimum for all central air conditioners stands at 13.
Fans for air handlers. A high-efficiency fan in the air handler qualifies for a credit, as long as it doesn't consume more than 2 percent of the total energy that the furnace, air conditioner or heat pump uses.
There are some other criteria, such as minimum EER ratings to go along with the above. If you have any questions, our experts can help.
The credits for air conditioners and heat pumps have a limit of $300, while the maximum for furnaces is $150. A high-efficiency fan qualifies for a credit of $50. Under this particular program (25C), taxpayers can only claim $500 total tax credits for the period from 2005 through the end of 2013. And Geothermal units still qualify for a 30% no limit tax credit that is still good through 2016.The credits help offset the cost of installing high efficiency HVAC equipment, which helps homeowners start enjoying lower utility bills faster. If you would like more information about taking advantage of the 25C program and taking a tax credit, contact Air Assurance. We've provided HVAC services for the Broken Arrow region for nearly 30 years.Our goal is to help educate our customers in the Tulsa and Broken Arrow, Oklahoma area about energy and home comfort issues (specific to HVAC systems). Image courtesy of Shutterstock