Are you one of the many people needing a new HVAC system in Bay Area homes? You may not be aware that President Obama signed into law this past January fiscal cliff legislation that retroactively reinstated the 25C tax credits that had originally expired in 2011. Now, if you qualify, you can have a new HVAC system installed in your Bay Area home and save!
Here are the details:
There is a $500 residential energy tax credit which goes back to January 1, 2005; this amount applies to the total tax credit for a lifetime on various qualified energy efficient retrofit improvements including windows, doors, insulation, hot water equipment, or roof. The improvements must be made to your primary residence.
Now, specific to HVAC equipment:
Depending on eligibility and your individual tax situation, when having a high efficiency heat pump or central air conditioner installed, you may qualify for tax credits of 10% of the cost, up to $300. To be considered high efficiency and qualify for the tax credit, there are a few requirements. First, if you purchase a package system central air conditioner, it must meet or exceed 12 EER (Energy Efficiency Ratio) and 14 SEER (Seasonal Energy Efficiency Ratio). Split systems should meet or exceed 13 EER and 16 SEER.
If you decide to buy a package heat pump system, be sure the system meets or exceeds 12 EER and 14 SEER; additionally the HSPF (Heating Seasonal Performance Factor) must be a minimum of 8. Air source heat pump systems should meet or exceed 8.5 HSPF, 12.5 EER, and 15 SEER.
Remember, the $500 is a lifetime cap, so if you have used the 25C tax credit to the limit, you will not qualify again. However, Hayward, Contra Costa, and San Francisco homeowners who have not used the tax credit and who meet qualifications can save on a new HVAC system, so be sure to act before time runs out on December 31 of this year!
At Ortiz Heating & Air Conditioning, we’re happy to answer any questions you may have about the 25C tax credit.