If you have an aging HVAC system that isn’t very efficient and is costing you more in repair bills, be proactive and schedule a new HVAC installation/HVAC replacement now. Replacing your heating and cooling units can be a pricey endeavor, but with Federal tax credits and rebates from energy suppliers, you get financial assistance to get the job done.

Inflation Reduction Act Tax Credits, Explained

Under the Inflation Reduction Act of 2022, federal income tax credits for energy-efficiency home improvements will be available through 2032. New HVAC installation and HVAC upgrades are eligible for the tax credits, as long as you install ENERGY STAR®-certified equipment.

In case you’re not familiar with tax credits, they are a dollar-for-dollar amount you can claim on your federal income tax return that will reduce the income tax you owe by that amount. Depending on the amount of tax you owe, the tax credits may increase your federal tax refund.

How Much Can You Get Back After HVAC Installation?

When you complete HVAC installation of ENERGY STAR®-certified equipment, you’ll pay for installation over time, if you secure financing. You’ll want to hold on to your receipts and equipment paperwork for when tax time rolls around.

For federal tax credits, you can claim 30% of the HVAC installation project cost, or up to $600. And you can claim more than one credit, up to a limit of $1,200. So, if you got an eligible new central AC unit as well as a new furnace, for example, you could get a $1,200 tax credit. For heat pumps, the limit is $2,000.

Again, the HVAC equipment must be ENERGY STAR®-certified, but includes:

  • Central Air Conditioners
  • Boilers
  • Heat Pumps
  • Furnaces

We can help you find HVAC equipment that meets the federal requirements. It all has to do with the SEER, EER2, and HSPF2 ratings of the various equipment.

You can learn more about the various requirements at the ENERGY STAR® website.

BG&E Rebate for a Smart Thermostat

In addition to the federal tax rebates, currently, BG&E[hj2] is offering a $75 rebate for installing a smart thermostat, which is standard with most energy-efficient HVAC systems.

Other Energy Efficient Home Upgrades

But wait. There’s more. In addition to the tax credits for heating and cooling, there are tax credits for installing better insulation, energy-efficient replacement windows and doors, and more. The total limit for energy-efficient tax credits in one year is $3,200.

And since the tax credits are good until the year 2032, you can make improvements over the course of several years that will make your home more energy-efficient, save you money on utility bills, and increase your tax refund.

What’s not to like?

Our Cockeysville HVAC Installation Experts Are Ready to Help!

Interested in upgrading your aging HVAC system? Fill out the contact form to request a quote or service, or call (410) 989-4378 24/7 for immediate help. We serve Cockeysville, Hunt Valley, Pikesville, Sparks, Stevenson, Timonium, and surrounding areas.