How to Earn the Residential Energy Efficiency Property Credit in North America in 2020

As far as energy-efficient HVAC installation in North America, there’s good news for homeowners at tax time.

The Residential Energy Efficient Property Credit will now go through 2020. This might qualify you for credits for energy-efficient home improvements, like modern heating and cooling equipment, water heaters and heat pumps.

What Equipment is Eligible?

To qualify for the incentive, the home must be the taxpayer’s primary residence in the United States. The improvement must work for a minimum of five years, with the first use starting with the homeowner.

What Types of Enhancements are Qualify for High-Efficiency Renovations?

Typically, this tax incentive corresponds with 10% of the expense of the subsequent energy-saving enhancements that achieve specified ENERGY STAR® guidelines:

 

  • Advanced main air-circulating fans
  • Energy-efficient gas, propane or oil furnaces
  • Energy-efficient gas, propane or oil hot water boilers
  • Energy-efficient heat pumps
  • Energy-efficient water heaters
  • Energy-efficient central air conditioners
  • Insulation
  • Particular metal and asphalt roofing
  • Particular exterior storm windows, skylights and storm doors
  • Solar/geothermal energy products, like solar electricity, solar water heaters and geothermal heat pumps

 

How Much Can I Claim?

Yes, there’s a lifetime cap of $500 per property. This means if you have used this incentive in prior years, you should decrease any credit you previously claimed.

If you have claimed the max amount, you won’t qualify for any other credits under this extension.

Credit Maximums for Specific Items

Tax reductions are restricted for a couple of qualified items:


  • Windows and skylights—$200
  • Advanced main air circulation—$50
  • Hot water boilers—$150
  • Energy-efficient systems—$300

If you have questions about how you can benefit from the extension of the residential energy efficient property tax credit, download Form 5695 or contact your tax advisor for assistance.

Enhance Your Heating and Cooling Equipment Today

Been procrastinating installing new heating and cooling system? Reach the Experts at 866-397-3787 or contact us online. We can help you choose an energy-efficient system you can reap tax benefits during the upcoming year.