Can I Receive a Tax Credit for My New Furnace?

For most families, there usually seems to be a large list of home improvement to-do’s that they want to do or new ideas they’d like to attempt. While several may not be necessary, furnace replacement is a task that could be critical to keeping your home comfortable through the cooler months in Sacramento.

Selecting a new furnace is a large investment. You’ll absolutely recognize the return-on-investment on your indoor comfort in addition to your energy costs, but it may be a bit daunting at first. The good news is that when you purchase 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 extended through December 31, 2020. In order to obtain the tax credit, you have to select a furnace that has earned the ENERGY STAR label. It cannot be a furnace that is labeled ENERGY STAR for “U.S. South Only.” When researching furnace replacements, watch for heat pumps with the ENERGY STAR rating so you can be sure you’re picking a high-efficiency furnace.

At Bishop’s HVAC, the experts will help you determine a solution that meets your needs and ensures you qualify for this tax credit. While ENERGY STAR products signify high efficiency, you will want to confirm the furnace you select 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.

Qualifying for the tax credit won’t be the only savings you’ll receive when you purchase a new high-efficiency furnace. A lot of the most efficient solutions can save you hundreds of dollars on your utility costs throughout the year. And your household will also have higher confidence in your HVAC system to maintain your indoor space at just the right comfort level.

If you have questions regarding your eligibility for a tax credit, or if there are additional local savings you could be eligible for by installing a new high-efficiency furnace, give our technicians at Bishop’s HVAC a call at 916-591-6889. You can also visit ENERGY STAR or contact your local utility establishment if you have questions about other eligible home products.