Can I get a tax credit for my new furnace?

April 08, 2020

For many families, there typically seems to be a large list of home improvement to-do’s that they want to complete or new ideas they’d like to try. While some may not be necessary, furnace replacement is one project that may be critical to keeping your home comfortable throughout the winter months in Cedar Rapids.

Buying a new furnace is a sizeable investment. You’ll definitely feel the return-on-investment on your indoor comfort along with your energy bills, but it might be a tad daunting at first. The good news is that when you shop for 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 pushed through December 31, 2020. In order to get the tax credit, you must purchase 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 shopping for furnace replacements, look for products with the ENERGY STAR rating so you can be certain you’re picking a high-efficiency furnace.

At Ilten's Incorporated, our team can help you choose a solution that matches your needs and makes sure you qualify for this tax credit. While ENERGY STAR products designate high efficiency, you will want to confirm the furnace you choose has an Annual Fuel Utilization Efficiency (AFUE) greater than 95, in order to qualify for the tax credit. AFUE indicates the percent of heat produced for every dollar of fuel consumed.

Taking advantage of this opportunity will not be the only savings you’ll find when you buy a new high-efficiency furnace. Many of the most efficient solutions can save you hundreds of dollars on your energy costs all year long. And your household will also have higher confidence in your HVAC system to keep your house at just the right temperature.

If you come across questions regarding your eligibility for a tax credit, or if there are other local savings you might be eligible for by purchasing a new high-efficiency furnace, give our experts at Ilten's Incorporated a call at 319-208-3295. You may also visit ENERGY STAR or contact your local utility company if you have questions about other eligible home products.