Those Hefty Energy Tax Credits: You Can Still Get Them For Geothermal
You may have heard about the tax credits that were available for upgrading your home with energy-efficient improvements, such as new HVAC systems or insulation. You may have also heard that those energy tax credits expired at the end of 2011.
Well, that’s only partly correct. Some of the energy tax credits have expired, such as the $150 credit on a high-efficiency furnace or the 10 percent credit on new insulation (which excluded installation, and was capped at $500). However, at least one energy tax credit is still available. What’s more, it’s by far the largest of the energy tax credits, with the fewest restrictions and no cap on the total amount you can earn.
We’re talking about the energy tax credit available for geothermal heating and cooling systems. Geothermal systems, also known as ground-source heat pumps, represent the most energy-efficient heating and cooling technology available today. Geothermal systems pump heat into or out of your house from the ground, which in our area maintains a constant temperature of about 60 degrees year-round. Therefore, very little energy is required to keep your home at a comfortable temperature.
Though geothermal systems offer significant long-term energy savings, they can cost more to install than other types of HVAC systems. That’s where the energy tax credits come in. When you install a geothermal system, the federal government will cover a full 30 percent of the cost through energy tax credits. The tax credit covers all installation expenses, including equipment and labor. There’s no upper limit on how large the credit can be. And since it’s a tax credit, and not a deduction, it applies to your actual tax bill instead of your taxable income. If the tax credit exceeds your tax bill, you will pay nothing in taxes this year, and the remaining credit will apply to next year’s taxes.
At Ernst Heating & Cooling, we offer high-efficiency geothermal heat pump systems for installation anywhere within the Metro-East area, and will help you get the maximum energy tax credit to save you money. Contact us today with any questions.
Our goal is to help educate our customers about energy and home comfort issues (specific to HVAC systems). For more information about energy tax credits and other HVAC topics, download our free Home Comfort Resource guide.
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