Federal Energy Tax Credit Update 2011
Federal tax credits are available for energy efficient products. If you buy energy efficient air conditioner or install a renewable energy system in your home, you will be eligible for federal tax credits. Biomass stoves, roof, heating, ventilating, air conditioning, insulation, water heater, windows and doors are normally eligible for tax credits, if they meet the qualification requirements. The tax credit was 30% of cost up to $1500 till December 31, 2010. The new tax credit for 2011 is not that much favorable to home owners. The maximum qualifying amount is less than the pre-ARRA amount. The lifetime maximum amount of rebate is $500 now.
A gas furnace uses fuel and air combustion to create heat. The qualifying rebate amount for gas furnace is $150. The qualification requirement is that the furnace should have 95% Annual Fuel Utilization Efficiency. Split systems will get rebates up to $300. Air conditioners with 16 SEER (Seasonal Energy Efficiency Ratio) or 13 EER (Energy Efficiency Ratio) are eligible to get this rebate. Tax credit includes the cost of installation. It is advisable to ask your HVAC contractor whether the air conditioner you want to buy is eligible to get tax credit.
Heat pumps offer a great alternative to furnaces and air conditioners, if you live in an area with moderate climates. Variable speed mini split heat pumps are normally eligible for tax credits. During summer seasons, they move heat from the cool outdoors into your home and move heat from your cool home into the warm outdoors during winter seasons. As they move heat instead of generating it, it can offer 4 times of energy they consume. Heat pumps with 15 SEER or 13 EER or 8.5 HSPF (Heating Seasonal Performance Factor) will be considered as qualifying products to get a rebate of $300. The tax credit is not applicable to solar water heaters, geothermal heat pumps and fuel cells.
According to new tax credit levels, the rebate for package systems amount to $300. Air conditioners with 14 SEER or 12 EER are eligible for rebates. Tax credits include the cost of installing the air conditioner. Heat pumps with 14 SEER, 12 EER or 8 HSPF package will receive a tax credit of $300. Gas or electric package with 14 SEER or 12 EER will also receive a tax credit of up to $300.
Advanced main air circulating fan is an energy efficient fan. The blower motor in the fan blows the air that is heated up by your furnace through the duct system. 30% tax credit was given on the cost of the fan until December 2010. Now the new tax credit is $50. Tax credit includes the cost of installing the air circulating fan.
You are eligible to get tax credit, if you have own home and you use it as your principal residence. Rental properties are not qualified for rebates and tax credits.
You can view the comprehensive list of qualified products for tax credit Here