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​Tax Credit

 

Federal Tax Credit Program for Qualifying Residential Indoor Comfort Systems

The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (as extended by the Protecting Americans from Tax Hikes Act of 2015) provides for federal tax credits on qualifying, high-efficiency residential heating and cooling products and systems (HVAC) through December 31, 2016.

This program is an extension of the federal tax credits that were in effect during 2009, 2010, and 2011.

  • The maximum amount an eligible homeowner may receive in federal tax credits for purchasing and installing qualifying products, whether those purchases are in the form of upgraded insulation, windows, HVAC equipment or other eligible improvements, is now 10% of the cost of the improvement, including installation costs, up to  $500 (with maximum per-category amounts listed below).
  • The $500 tax credit amount is reduced by the total amount of residential energy property credits a homeowner has claimed for purchases between 2006 and 2016. If a residential homeowner has already claimed single-family home tax credits of $500 or more from improvements made prior to 2016, he or she cannot claim any new tax credits during 2016.
  • All furnaces and boilers, whether fueled by natural gas, propane or fuel oil, must have an AFUE rating of 95% or higher to be eligible.
  • Products or units must be installed between January 1, 2009, and December 31, 2016, to be eligible for tax credits.
Maximum Available Tax Credit Product Type Efficiency Requirements
$50 Any Advanced Main Air Circulating Fan Electricity consumption of no more than 2% of the total energy use of the furnace Tax Certificate
$150 Natural Gas, Propane, Oil Furnaces or Boilers 95% AFUE rating —Tax Certificate
$300 Split-System Air Conditioners 16 SEER / 13 EER —Tax Certificate
$300 Split-System Heat Pumps 15 SEER / 12.5 EER / 8.5 HSPF —Tax Certificate
$300 Packaged Air Conditioners 14 SEER / 12 EER —Tax Certificate
$300 Packaged Heat Pumps 14 SEER / 12 EER / 8 HSPF —Tax Certificate
$300 Packaged Gas/Electric Units 14 SEER / 12 EER —Tax Certificate


This information is provided for discussion purposes only and is provided as a generic guideline. No consideration should be taken that this information represents tax advice. Contact your local tax professional to determine how these credits may apply to your circumstances and visit  www.energy.gov/taxbreaks for more information.