Can I earn a tax credit for my new furnace?

April 08, 2020

For a lot of homeowners, there typically seems to be a large list of home improvement tasks that they would like to complete or new ideas they’d like to try. While several may not be required, furnace replacement is an example of a project that could be critical to keeping your home comfortable through the colder months in Alliance.

Selecting a new furnace is a great investment. You’ll absolutely recognize the return-on-investment on your indoor comfort in addition to your utility costs, but it may be a bit overwhelming at first. The good news is that when you pick a new energy-efficient furnace, you could be qualified for a federal tax credit.

According to ENERGY STAR®, the Non-Business Energy Property Tax Credits were extended through December 31, 2020. In order to receive the tax credit, you are required to purchase a furnace that has earned the ENERGY STAR label. Keep in mind it can’t be a furnace that is labeled ENERGY STAR for “U.S. South Only.” When browsing for furnace replacements, keep an eye out for heat pumps with the ENERGY STAR rating so you can be certain you’re picking a high-efficiency furnace.

At Jack's Heating, Cooling, Stoves & Fireplaces, our team can help you choose a solution that fits your needs and helps you qualify for this tax credit. While ENERGY STAR products indicate high efficiency, you will want to check the furnace you pick has an Annual Fuel Utilization Efficiency (AFUE) greater than 95, in order to qualify for the tax credit. AFUE means the percent of heat produced for every dollar of fuel consumed.

Qualifying for the tax credit will not be the only savings you’ll observe when you purchase a new high-efficiency furnace. Many of the most efficient furnaces can save you hundreds of dollars on your energy costs during the year. And you’ll also have higher confidence in your HVAC system to maintain your indoor space at just the right temperature.

If you have questions regarding your eligibility for a tax credit, or if there are further local savings you might be eligible for by purchasing a new high-efficiency furnace, give our experts at Jack's Heating, Cooling, Stoves & Fireplaces a call at 308-646-3827. You could also visit ENERGY STAR or contact your local utility organization if you have questions about other eligible home products.