Written by Brad Crawford
Another benefit of an HVAC upgrade to improve heating and cooling efficiency came from Washington, D.C., earlier this year. The 25C Tax Credit for upgrading residential systems was reinstated after having been allowed to lapse in 2011. Congress has taken renewed action to encourage installation of an HVAC upgrade that conserves energy while delivering gains in performance and comfort. The tax credit applies to qualified equipment purchased and installed from Jan. 1, 2012 through Dec. 31, 2013. Unlike a mere exemption, a tax credit reduces the tax due at the bottom of your tax return, putting money directly back in your pocket. In addition, you’ll receive the savings from lower utility costs and a range of options available on high-efficiency equipment.
Tax credits are equal to 10 percent of the cost of purchase and installation of a high-efficiency HVAC upgrade. The credit is capped at a system maximum of $500. This includes $300 for an approved air conditioner or heat pump, $150 for a matching furnace and $50 for an advanced blower with high-efficiency ECM technology. The individual requirement for each HVAC component are as follows:
- A split system air conditioner must have a SEER (Seasonal Energy Efficiency Ratio) of at least 16 and an EER (Energy Efficiency Ratio) of at least 13.
- A split system heat pump must have a SEER rating of at least 15, a 12.5 EER and an 8.5 HSPF (Heating Seasonal Performance Factor).
- A gas furnace must have an AFUE (Annual Fuel Utilization Efficiency) of 95 percent or greater.
- An advanced air circulation blower fan must consume no more than 2 percent of the total system energy.
- Geothermal systems that meet or exceed the requirements of the Department of Energy’s Energy Star program qualify for a one-time credit of 30 percent of the cost of the system. This credit is retroactive to include units installed after Dec. 31, 2007, and runs through 2016. The same credit is available for qualified residential solar systems.
Crawford Services, Inc. provides quality air conditioning, heating and plumbing services to North Texas homeowners. Ask us about a high-efficiency HVAC upgrade to qualify for the 25C Tax Credit before it expires.
Our goal is to help educate our customers in North Texas about energy and home comfort issues (specific to HVAC systems).
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