Can I receive a tax credit for my new furnace?

April 08, 2020

For many homeowners, there always seems to be a long list of home improvement projects that they need to complete or new ideas they’d like to give a shot. While a handful may not be required, furnace replacement is an example of a project that may be critical to keeping your home comfortable through the winter months in Monroe.

Purchasing a new furnace is a big investment. You’ll definitely see the return-on-investment on your indoor comfort along with your energy bills, but it could be a bit overwhelming at first. The good news is that when you pick a new energy-efficient furnace, you might be approved 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 are required to select a furnace that has earned the ENERGY STAR label. However, it can’t be a furnace that is labeled ENERGY STAR for “U.S. South Only.” When researching furnace replacements, keep an eye out for heat pumps with the ENERGY STAR rating so you can be sure you’re selecting a high-efficiency furnace.

At Lanz Furnace and Fireplace, we’ll help you determine a product that fits your needs and makes sure you qualify for this tax credit. While ENERGY STAR products designate high efficiency, you’ll need to clarify that the furnace you select 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 won’t be the only savings you’ll observe when you purchase a new high-efficiency furnace. A lot of the most efficient models can save you hundreds of dollars on your utility costs all year long. And your household will also have more confidence in your HVAC system to help your home stay at just the right comfort level.

If you think of questions regarding your eligibility for a tax credit, or if there are further local savings you might be eligible for by buying a new high-efficiency furnace, give our professionals at Lanz Furnace and Fireplace a call at 608-291-3606. You may also visit ENERGY STAR or contact your local utility company if you have questions about other eligible home products.