The federal government has made tax credits available until the end of December 31, 2016 for home improvements in existing, primary homes that promote energy savings. These credits apply to qualifying purchases made in 2015 and 2016 and range from HVAC systems to new windows. Homeowners can deduct 10 percent of the purchase and installation costs for a maximum credit of $500.
The types of improvements include:
- Biomass stoves
- HVAC systems, including high efficiency air conditioners, heat pumps and furnaces.
- Water heaters (not solar)
- Skylights and windows
Specific guidelines for each of these products exist and as a general rule, they must be Energy Star certified to be eligible. This program helps you increase your home’s energy efficiency, especially if your HVAC system or water heater is aging and inefficient.
Other improvements that make a noticeable difference in year-round energy bills include your windows and attic insulation. Single pane windows and inadequate attic insulation will drive up energy bills year-round, but more so during the long, hot summers.
Extended Tax Credit Programs
The Department of Energy recently extended more generous credits that were originally set to expire at the end of the year. Geothermal heat pumps (GHPs), solar installations and wind turbines are the exception to the cap on the tax credits.
Anyone who installs any of these can claim 30 percent of the entire cost and there’s no cap on the credit. All are eligible when installed in new and existing homes as well as second homes, but not rental properties. The credits last through 2021, although credits decrease on a sliding scale.
Florida is one of the best places for solar generation and water heating. Heating water is third in line for energy consumption in the average home, following HVAC systems and swimming pool pumps. Solar arrays and water heaters must meet the Energy Star guidelines for eligibility.
These tax credits provide an excellent way to offset the cost of home improvements that lower your energy costs and increase comfort. To learn more, contact Rinaldi’s Energy Solutions, providing trusted energy services for Orlando-area homeowners.
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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