Are you looking to upgrade your home's HVAC system or other important components? If so, you may be eligible for a federal tax credit. In this article, we'll discuss the Inflation Reduction Act of 2018 and how it can help you save money on energy bills and reduce your tax burden. The Inflation Reduction Act of 2018 introduced a tax credit for homeowners who install energy-efficient home improvement systems. This includes central air conditioning systems, boilers, furnaces, air-source heat pumps, and biomass stoves that meet certain efficiency benchmarks.
The credit covers 10% of the cost of the equipment, including installation costs. To be eligible for the tax credit, the system must be installed in your current home, which is also your primary residence. Unfortunately, tax credits are not available for new construction or rentals. They are only for the systems that you replaced or added to your current home.
To apply for the tax credit, you must submit IRS Form 5695 along with your tax return. To qualify for credits, you must keep a copy of the manufacturer's certification statement to show the system's efficiency ratings. You won't qualify for credits without one. For those who have applied for a non-commercial energy property tax credit in the past, they have likely reached the limit. Or if you suspect that you might reach the tax credit limit, consult a tax preparation professional instead. In addition to being reimbursed for some of the initial costs of a new system, you'll also save money in the long run, since a new, highly efficient HVAC system costs much less to operate than other older systems. If you're thinking about upgrading your air conditioning system in the Delaware Valley, call ECI to make sure your new system will save you money on energy bills and reduce your tax burden. Houston residents have access to tax credits equivalent to up to 30% of the cost of installing new HVAC equipment that meets specific efficiency requirements. This is a summary of the HVAC appliances eligible for non-commercial energy property tax credits this year and how much you can recover.
If you are considering replacing an old or worn-out HVAC system or other important component of your home, you can maximize your tax benefits by distributing the improvements over several tax years. Because one of the main goals of the Inflation Reduction Act was to focus on energy efficiency, many home systems, in addition to HVAC equipment and even a home energy audit, are eligible for expanded tax credits under the Act. In conclusion, if you're looking to upgrade your HVAC system or other important components of your home, it's worth looking into whether or not you're eligible for a federal tax credit. By taking advantage of this credit, you can save money on energy bills and reduce your tax burden.
