Upgrade HVAC Equipment and Qualify for Energy Tax Credits

by Greg Leisgang on April 11, 2013

Posted in: Energy Savings

energy tax credits, Cincinnati, OhioIf your house is like many homes in the greater Cincinnati area, there are several projects you could do to reduce your utility bills. Fortunately, 2013 is a good year to get started. The federal legislation to avoid the "fiscal cliff" extended the energy tax credits that originally expired in 2011 to the end of 2013, including retroactive applicability to expenditures made in 2012. You can upgrade your heating and cooling systems to improve energy efficiency and get the federal government to pay part of the tab.

The energy tax credits have certain limitations and requirements, so check with your tax advisor and your HVAC contractor to see if your plans qualify. There's a lifetime maximum of $500 in credits allowed, and only the most energy efficient equipment qualifies.

Here's a list of the types of equipment that qualify for the credits, along with the applicable limits. Keep in mind that SEER (seasonal energy efficiency ratio) and AFUE (annual fuel utilization efficiency) are standard ratings of energy efficiency:

  • A heat pump or air conditioner with a SEER between 12 and 16, depending on the specific equipment, qualifies for a credit up to $300.
  • Main air circulating fans for natural gas, oil or propane furnaces qualify for a credit of up to $50 if the fan consumes less than 2 percent of the total energy consumed by the furnace.
  • A propane, natural gas or oil furnace or boiler with an AFUE of 95 percent or greater qualifies for a credit up to $150.
  • An oil, natural gas or propane water heater with a thermal efficiency of 90 percent or higher, or an electric heat pump water heater with an energy factor of 2.0 or higher qualifies for a credit up to $300.

Other energy conservation measures such as upgrading insulation also qualify for energy tax credits. Your investment in HVAC equipment upgrades, a new water heater or other efficiency projects can pay you back from reduced energy bills alone, but if you take advantage of federal energy tax credits this year, the return on your investment may be even better.

For more information about energy tax credits, or any other HVAC issues, contact us at JonLe Heating & Cooling. We've served Butler County and the Greater Cincinnati area since 1959.

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