Your Guide to Applying for HVAC Tax Credits in 2024

To avoid rising energy costs and work toward a more sustainable life, many homeowners are trying new methods to maintain comfort levels while using less energy. With help from the Inflation Reduction Act, federal tax credits are available for upgrading to more efficient HVAC systems, such as air conditioners. These credits offer significant savings, as long as the homeowners choose eligible equipment and submit the appropriate form.

If you’re trying to avoid a long process, maybe we can help! Three Rivers Heating & Cooling hopes this guide will give you what you need to secure 2024’s HVAC tax credits. Here’s how.

Understanding the HVAC Tax Credits

These valuable tax credits for upgrading your home to be more energy-efficient are just one portion of the recent Inflation Reduction Act. Energy costs affect everyone, so helping homeowners upgrade to higher efficiency utilities can benefit everyone. The key provision of these credits is to help pay for high efficiency HVAC equipment and other projects. Two of note are the Residential Clean Energy Credit and the Energy Efficiency Home Improvement Credit.

But remember, to earn any of the credits, you’ll need a completed IRS Form 5695. Additionally, this form needs to be submitted during the same tax year your upgrades were installed, not bought.

Maximizing Savings with the Energy Efficiency Home Improvement Credit

Through 2032, the Energy Efficiency Home Improvement credit empowers homeowners by offsetting up to $3,200 annually for making your home more energy-efficient. This equals 30% of the total project’s cost. It’s important to note in order to receive the maximum amount, you’ll have to make several investments. For example, you’ll get up to $2,000 for a new, high-efficiency heat pump. This can be paired with an additional $1,200 in credits for more projects in the tax year.

While new heat pump installation projects are a key target for this incentive, high-efficiency furnaces, air conditioners, boilers, and other HVAC systems are still eligible for this tax credit. You should confirm the make and model’s energy efficiency rating is high enough for eligibility.

Exploring the Residential Clean Energy Credit

The Residential Clean Energy Credit amounts to roughly 30% savings on a variety of residential clean energy efficiency projects. Eligibility only applies to homeowners looking for new clean energy solutions for their home. While the Home Improvement Credit highlights utilities and HVAC systems, this credit targets renewable energy sources like solar and wind energy.

Some key details of this tax credit include the requirement that installation must occur between 2022 and 2032. But at the same time, homeowners can carry forward excess credit to offset future tax obligations. This is a great way to soften the entry into investing in clean energy.

Additional Qualifications for Energy Tax Credits

Because HVAC systems are one of the major reasons for high energy bills, these tax credits incentivize the most energy-efficient options. But home energy efficiency can be improved in lots of other ways. Apart from the previously listed HVAC upgrades, {you could also choose|other eligible items include|you also have access to:

• Energy-saving heat pump water heating systems
• Modern electrical panel improvements
• Upgraded electrical wiring
• Enhancements to insulation, air sealing, and ventilation
• High-efficiency electric stoves, cooktops, ranges or ovens
• Heat pump clothes dryers
• Water boilers

Like the HVAC systems, you’ll need to check that your preferred make and model features the eligible energy efficiency ratings.

Three Tips for Making the Most of 2024 HVAC Tax Credits

While any one of those upgrades can boost home energy efficiency, a little planning will ensure they offer the most long-term benefits. Maximize your HVAC tax credits with the following three tips:

1. Conduct a home energy audit to identify impactful upgrades. Rely on professional HVAC assessments for crucial advice.
2. Install new high efficiency windows and doors.
3. Explore potential rebates from utility companies for clean energy upgrades. Renewable sources like solar, wind, and geothermal contribute to community power grid sustainability.
4. Remember to consider financing plans offered by service providers.

Secure Your 2024 HVAC Credits with Help from Three Rivers Heating & Cooling

Partner with local HVAC professionals like Three Rivers Heating & Cooling for eligible serves like energy assessments or new installation. Our helpful installers can deliver whatever you need for a more energy-efficient home.