Here’s an overview of potential tax credits available in 2014. In January 2013, the so-called “fiscal cliff” standoff was concluded with Congress passing the American Taxpayer Relief Act of 2012.
This bill extended tax credits that ran out at the end of 2011. The extension was for 2012 and 2013, but it is possible that Congress might extend them into 2014. At this writing, that has not happened. We’ll update this post if the extension is made.
If you made an HVAC purchase in 2013, here’s an overview of the bill and how you can take advantage of it.
Tax Credit: 10% of the cost up to $500 for general work or a specific dollar amount from $50 to $300 for certain purchases. These include:
$50 for installation of an Advanced Main Air Circulating Fan – a furnace blower – that uses not more than 2% of the total furnace energy use.
$300 for installation of an air-source heat pump. The unit must meet or surpass these specifications: 15 SEER, 12.5 EER and 8.5 HSPF for split-system heat pumps.
For packaged heat pumps, the specifications that must be met or exceeded are: 14 SEER, 12 EER and 8.0 HSPF.
$300 for installation of an efficient central air conditioner. The specifications to meet or surpass are: 16 SEER and 13 EER for a split-system model and 14 SEER and 12 EER for a packaged unit.
$150 for the installation of a gas, propane or oil furnace that is at least 95% efficient – an AFUE of 95 or higher.
There’s a tax credit for adding insulation to your home. The credit is for 10% of the cost up to a limit of $500 total tax credit. The insulation may be in the form of bulk insulation such as batts, rolls, rigid board, blown-in fibers or expanding spray. In addition, weather stripping, caulk and house wrap are included.
There’s a 10% tax credit for installing Energy Star doors and windows. The limit on doors is $500 and the limit on windows is $200.
If you’ve installed a geothermal heat pump, a tax credit is available too. The credit is for 30% of the cost with no upper limit. Here are the specifications that must be met or exceeded:
Water to Air: Closed loop – EER 17.1, COP 3.6; Open loop – EER 21.1, COP 4.1.
Water to Water: Closed loop – EER 16.1, COP 3.1; Open loop – EER 20.1, COP 3.5.
Direct Expansion: EER 16, COP 3.6.
If you’re applying for tax credits for purchases made in 2013, you find instructions along with the form here.
Make sure the form is for 2013.