Can I receive a tax credit for my new furnace?

April 08, 2020

For many families, there typically seems to be a long list of home improvement projects that they need to complete or new ideas they’d like to give a shot. While a handful may not be necessary, furnace replacement is a job that might be critical to keeping your home comfortable during the cooler months in Ballwin and St. Charles.

Purchasing a new furnace is a sizeable investment. You’ll definitely see the return-on-investment on your indoor comfort as well as your energy bills, but it may be a bit overwhelming at first. The good news is that when you purchase a new energy-efficient furnace, you might be approved for a federal tax credit.

According to ENERGY STAR®, the Non-Business Energy Property Tax Credits were prolonged through December 31, 2020. In order to get the tax credit, you are required to select 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, watch for solutions with the ENERGY STAR rating so you can be sure you’re choosing a high-efficiency furnace.

At Air Alliance Team, our team can help you select a product that matches your needs and ensures you qualify for this tax credit. While ENERGY STAR products designate high efficiency, you’ll need to confirm the furnace you pick has an Annual Fuel Utilization Efficiency (AFUE) greater than 95, in order to qualify for the tax credit. AFUE indicates the percent of heat produced for every dollar of fuel consumed.

Qualifying for the tax credit won’t be the only savings you’ll observe when you purchase a new high-efficiency furnace. Some of the most efficient furnaces can save you hundreds of dollars on your energy bills throughout the year. And your household will also have more confidence in your HVAC system to help your home stay at just the right comfort level.

If you think of questions concerning your eligibility for a tax credit, or if there are further local savings you might be eligible for by buying a new high-efficiency furnace, give our experts at Air Alliance Team a call at 636-206-4250. You can also visit ENERGY STAR or contact your local utility organization if you have questions about other eligible home products.