You May be Eligible for a HVAC or Water Heater Tax Credit

Did you install an energy efficient furnace, boiler, air conditioner or water heater in 2012 or do you plan to upgrade or replace your system in 2013? If so, you might be eligible to receive a tax credit on your taxes.

On January 2nd, President Obama signed legislation designed to avoid the “fiscal cliff” and keep tax rates from increasing for tax paying Americans. In addition to many other tax provisions, the bill retroactively reinstates the 25C tax credits for highly efficient HVAC and water heating equipment that expired in 2011.

This bill extends the tax credits that expired in 2011 from January 1, 2012 until December 31, 2013 for qualified equipment listed in Section 25C of the Internal Revenue Code. They can be used for qualified equipment that was installed any time after December 31, 2011.

Qualified equipment includes:

Water Heaters ($300 Tax Credit)

Electric heat pump water heaters with an energy factor of at least 2.0
Natural gas, propane, or oil water heater with an energy factor of at least 0.82 or a thermal efficiency of at least 90 percent

Furnaces ($150 Tax Credit)

Natural gas, propane, or oil furnace with an AFUE of not less than 95

Boilers ($150 Tax Credit)

Natural gas, propane, or oil boiler with an AFUE of not less than 95

Air Conditioners and Heat Pumps ($300 Tax Credit)

Split system central air conditioner that achieves the highest efficiency CEE tier as of January 1, 2009 (16 SEER; 13 EER)
Packaged central air conditioner that achieves the highest efficiency CEE tier as of January 1, 2009 (14 SEER; 12 EER)
Split system electric heat pump that achieves the highest efficiency CEE tier as of January 1, 2009 (8.5 HSPF; 12.5 EER; 15 SEER)
Packaged electric heat pump that achieves the highest efficiency CEE tier as of January 1, 2009 (8.0 HSPF; 12.0 EER; 14 SEER)

Advanced Main Air Circulating Fan ($50 Tax Credit)