Can I earn a tax credit for my new furnace?

April 08, 2020

For most homeowners, there typically seems to be a large list of home improvement to-do’s that they want to complete or new ideas they’d like to give a shot. While some may not be necessary, furnace replacement is one job that might be critical to keeping your home comfortable during the cooler months in Excelsior Springs.

Selecting a new furnace is a large investment. You’ll certainly notice the return-on-investment on your indoor comfort as well as your energy bills, but it may be a bit intimidating at first. The good news is that when you shop for a new energy-efficient furnace, you may be qualified 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 get the tax credit, you are required to buy 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 researching furnace replacements, look for heat pumps with the ENERGY STAR rating so you can be sure you’re selecting a high-efficiency furnace.

At Colvin's Heating and Cooling, we’ll help you determine a product that matches your needs and ensures you qualify for this tax credit. While ENERGY STAR products indicate high efficiency, it’s important 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 means the percent of heat produced for every dollar of fuel consumed.

Taking advantage of this opportunity will not be the only savings you’ll find when you buy a new high-efficiency furnace. Many of the most efficient furnaces can save you hundreds of dollars on your energy bills all year long. And your family will also have more confidence in your HVAC system to help your home stay at just the right comfort level.

If you come across questions about your eligibility for a tax credit, or if there are further local savings you could be eligible for by installing a new high-efficiency furnace, give our professionals at Colvin's Heating and Cooling a call at 816-379-3918. You may also visit ENERGY STAR or contact your local utility establishment if you have questions about other eligible home products.