Can I Receive a Tax Credit for My New Furnace?

For many households, there always seems to be a long list of home improvement tasks that they would like to get done or new ideas they’d like to try. While some may not be necessities, furnace replacement is a task that may be critical to keeping your home comfortable throughout the cooler months in Hodgenville.

Selecting a new furnace is a large investment. You’ll certainly see the return-on-investment on your indoor comfort along with your energy bills, but it might be a little intimidating at first. The good news is that when you pick a new energy-efficient furnace, you might be eligible for a federal tax credit.

According to ENERGY STAR®, the Non-Business Energy Property Tax Credits were pushed through December 31, 2020. In order to obtain the tax credit, you must purchase a furnace that has earned the ENERGY STAR label. However, it can’t be a furnace that is labeled ENERGY STAR for “U.S. South Only.” When browsing for furnace replacements, look for products with the ENERGY STAR rating so you can be certain you’re selecting a high-efficiency furnace.

At Phelps Heating & Cooling, Inc., the experts will help you select an option that matches your needs and makes sure you qualify for this tax credit. While ENERGY STAR products designate high efficiency, you’ll need to clarify that the furnace you select has an Annual Fuel Utilization Efficiency (AFUE) greater than 95, in order to qualify for the tax credit. AFUE means the percent of heat produced for every dollar of fuel consumed.

This tax credit won’t be the only savings you’ll observe when you get a new high-efficiency furnace. A lot of the most efficient furnaces can save you hundreds of dollars on your utility costs all year long. And your family will also have higher confidence in your HVAC system to maintain your indoor space at just the right temperature.

If you come across questions concerning your eligibility for a tax credit, or if there are additional local savings you might be eligible for by buying a new high-efficiency furnace, give our professionals at Phelps Heating & Cooling, Inc. a call at 270-358-3167. You could also visit ENERGY STAR or contact your local utility organization if you have questions about other eligible home products.