Latest News
Energy Tax Credits 2014
After hours of fitful debate during the month of December, the House of Representatives passed the tax extender package by a vote of 277-148. If you listen to the news sound bites, everyone involved has said that the bill is not perfect. Here is how this new extender package involving HVAC affect you.
Included in the new law is “Section 25c Tax Credit”, the official name for the energy tax credits available to eligible tax payers who make qualified energy efficient retrofits to their homes.
Starting January 1, 2014 and through December 31, 2014, an eligible homeowner can claim 10% of the costs, capped at $500.00 for the installation of qualified energy efficient improvements, subject to certain limits.
Under this new law, for HVAC and hot water equipment, the maximum a homeowner can claim is $300.00 for a qualified central air conditioner and heat pump, and $150.00 for any advanced main air circulating fan. The tax credit for qualified hot water heaters is limited to $300.00.
What’s the difference between a tax credit and a tax deduction?
A tax credit applies directly against the taxpayers’ liability. A tax deduction applies against a taxpayer’s income, lowering the adjusted gross income and possibly moving the taxpayer to a lower tax bracket. Tax credits have a greater benefit to a taxpayer than a tax deduction.
How do homeowners claim the credits and receive their money?
The IRS has directed taxpayers to use Form 5695, Residential Energy Efficient Property Credit. Taxpayers should keep copies of invoices and receipts to document their actual expenditures, but only need to file Form 5695 with their tax returns to get the tax credits.
http://www.irs.gov/pub/irs-pdf/f5695.pdf
What will qualify for the tax credit?
The qualifying standard for natural gas hot water boilers, propane hot water boilers, oil furnaces and oil hot water boil is 95% AFUE (Annual Fuel Utilization Efficiency). For natural gas furnaces and propane furnaces the standard is 95%AFUE.
The qualifying standard for central air conditioners and heat pumps must meet or exceed 16 SEER (Seasonal Energy Efficiency Ratio) and 13 EER (Energy Efficiency Ratio); and an air source heat pump must meet or exceed 15 SEER and 12.5 EER and 8.5 HSPF (Heating Seasonal Performance Factor).
Lifetime Caps Reinstated
The “lifetime caps” has been reinstated which disqualify any homeowner who has claimed more than $500.00 in 25c tax credits since January 1, 2005.
While the extension of the tax credits which are of lower valve is not ideal, it keeps the tax credits alive and leaves open the opportunity to change them in the next congress and restore them to the $1,500.00 level. Write your congressman and keep current to the changes made on our behalf.
Information provided by ACCA (Air Conditioning Contractors of America)
Federal Tax Credits & Savings
Incentive Dollars are available to homeowners under the new Federal Stimulus package, local utility rebate, NYSERDA Energy Star Program, and manufacturer rebates!
Up to $1,500 tax credit on 95% efficient furnaces & 90% efficient boilers and 10%-50% savings rebate on higher efficiency upgrades through NYSERDA/Energy Star.
For your state’s up-to-date federal rebates form visit the Database of State Incentives for Renewables and Efficiency (DSIRE) at www.dsireusa.org.
ConEdison Rebates Available
Cash back for Energy Star A/C purchases and customers can enroll in a variety of energy savings programs, including homeowners, renters, small businesses and commercial/industrial customers.
http://www.conedhvacrebates.com/uploads/pdfs/consumer-brochu…
Home Envelope
Homeowners can receive a tax credit for making envelope improvements to and installing energy-efficient heating, cooling, and water heating equipment in their primary residence. The incentive is 30% of the cost of eligible measures, with a $1,500 cap on the credit per home. The tax credit for envelope improvements is based on the cost of the materials installed (insulation, windows, sealants, etc.), not the cost of labor. The credit for home heating and cooling and water heating equipment is based on both the cost of the materials and installation labor costs. These incentives do not include measures placed in service during 2008.
For more information visit the link below:
http://www.energytaxincentives.org/consumers/insulation_etc.php
TIAP (The Tax Incentives Assistance Project)
Sponsored by a coalition of public interest non- profit groups, government agencies and other organizations in the energy efficiency field, which is designed to give consumers and businesses information they need to make use of the federal income tax incentives for energy efficient products and technologies passed by Congress as part of the Energy Policy Act of 2005 and subsequently amended several times. The legislation extends the new homes tax credit to cover 2010 and 2011 – this $2,000.00 credit goes to the home builders and is for homes that use no more than half the energy of homes that just meet the 2003 national model energy code. This bill extends these credits for new homes that are built in 2010 and 2011.
Our Congress is likely to consider further extensions of these incentives for HVAC into 2012 and beyond next year and TIAP will provide updates as they become available.
http://www.taxincentivesassistantproject.com
