Can I receive a tax credit for my new furnace?

April 08, 2020

For a lot of homeowners, there typically seems to be a lengthy list of home improvement to-do’s that they want to complete or new ideas they’d like to try. While several may not be necessary, furnace replacement is a job that might be critical to keeping your home comfortable throughout the cooler months in Marshalltown.

Purchasing a new furnace is a large investment. You’ll certainly realize the return-on-investment on your indoor comfort along with your energy bills, but it may be a bit overwhelming at first. The good news is that when you buy a new energy-efficient furnace, you could be approved for a federal tax credit.

According to ENERGY STAR®, the Non-Business Energy Property Tax Credits were prolonged through December 31, 2020. In order to get the tax credit, you have to select 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 certain you’re selecting a high-efficiency furnace.

At Kapaun & Brown Inc., the experts will help you select a product that fits your needs and ensures you qualify for this tax credit. While ENERGY STAR products signify high efficiency, you will want to clarify that the furnace you pick has an Annual Fuel Utilization Efficiency (AFUE) greater than 95, in order to qualify for the tax credit. AFUE represents the percent of heat produced for every dollar of fuel consumed.

This tax credit won’t be the only savings you’ll find when you select a new high-efficiency furnace. Some of the most efficient furnaces can save you hundreds of dollars on your energy costs throughout the year. And your family will also have higher confidence in your HVAC system to maintain your indoor space at just the right comfort level.

If you think of questions regarding 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 teams at Kapaun & Brown Inc. a call at 641-812-2028. You could also visit ENERGY STAR or contact your local utility organization if you have questions about other eligible home products.