Do you wonder how much your furnace or air conditioner is costing you? The cost of the unit when you purchase it is actually the smallest part of the equation when you consider your monthly utility costs. When you compare an older furnace with a new, energy efficient and Energy Star rated furnace the monthly costs can be quite substantial. Why not take a look at replacing your old furnace and air conditioner with a new system? With the help of the many tax credits and rebates now available you may find that it is within your budget. In this article we’ll cover some of the details of the Federal tax credits available as well as some rebate programs specifically designed for New Jersey residents. By the end of this article you’ll be armed with the information you need to make a good decision for your household.
HVAC Tax Credits from Uncle Sam
If you file taxes and own your own home, then you’re eligible for up to $1500 in tax credits when you purchase a qualifying HVAC system. The credits are good for up to 30% of a new system and you receive the credit off of your federal income taxes. You need to be sure to follow the fine print however. Systems must meet or exceed the program’s Energy Star requirements – not all HVAC products will qualify. You need to find a licensed contractor to install your system. You need to keep your receipts and at the end of the year file tax form 5965 along with your 1040. You can’t carry forward the credits, but there is no income limit so anyone who has their own home can qualify.
New Jersey HVAC Rebates
If you live in NJ, you can qualify for more than just the standard Federal tax credits. By combining both local and Federal incentives, you can save a bundle off of the HVAC installation of a new system. Through New Jersey’s Clean Energy program you can qualify for rebates on high efficiency furnaces, air conditioners and heat pumps. Depending on the type of upgraded system you purchase, you can receive up to $450 in additional rebates.
To be eligible for this program you must:
- Submit your rebate application within one year of the installation.
- Be a residential electric customer of qualifying NJ utility companies such as Atlantic City Electric, Jersey Central Power and Rockland Electric to name a few.
- All installations must meet local codes and laws.
- All systems must meet or exceed posted efficiency ratings to qualify.
Save Now, Save Later
By purchasing new HVAC products you save money with the tax credits and rebates on the up front cost, but you also save money year after year with the decreased cost of electricity and/or natural gas. Do a bit of research by contacting a licensed professional who provides HVAC help and ask them how much a new system would cost. Also ask how much you can expect to save on utilities. Compare different HVAC products and determine your needs, then make the decision. Your pocketbook will thank you.