Considering a Geothermal Heat Pump? There’s an Available Tax Credit!
Taking advantage of the federal tax credit for a geothermal heat pump (GHP) before the end of 2016 will jump-start your energy savings with this type of system. Since a GHP offers the best energy efficiency of any other type of HVAC system, 2016 could be the most opportune time in the foreseeable future to upgrade your HVAC equipment.
The credit is a part of the Recovery Act of 2009 and it’s one of the last to expire at the close of the year. The aim of the Recovery Act was to help homeowners save energy and boost the economy by spurring investments in durable improvements for their homes.
You can qualify for the credit by:
- Installing an Energy Star or Most Efficient system by December 31, 2016.
- Using the GHP in a primary or secondary home that’s either a new build or an existing one.
- Filing Form 5696 with your federal taxes. The entire cost of the GHP is deductible for the 30 percent credit, and there is no limit on the amount you can claim.
The geothermal heat pump credit is so generous because it makes it easier for homeowners to financially handle the higher cost of a GHP, largely due to its installation costs. GHPs work just like air-source heat pumps, but instead of using outdoor air to complete the heat transfer process, they use the thermal energy deep underground through an underground loop field that’s six to eight feet deep.
Temperatures change little underground throughout the year, and it’s much easier to extract heat for your home from the ground and replace it in the summer, instead of doing so when air temperatures chill or soar. Besides offering top efficiency, a GHP has a long life expectancy. The underground loop field where the heat exchange takes place lasts 50 years and longer, while the indoor heat pump can reach 25 years or more, as long as it’s routinely serviced.
To learn more about using the tax credit for a geothermal heat pump, contact Rinaldi’s Energy Solutions, proudly serving Orlando area homeowners since 1969.
Our goal is to help educate our customers in Orlando, Florida and surrounding areas about energy and home comfort issues (specific to HVAC systems).
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