Can I get a tax credit for my new furnace?

April 08, 2020

For many homeowners, there typically seems to be a long list of home improvement projects that they need to get done or new ideas they’d like to attempt. While several may not be required, furnace replacement is one task that may be key to keeping your home comfortable through the winter months in Tuscaloosa.

Getting a new furnace is a great investment. You’ll certainly see the return-on-investment on your indoor comfort as well as your utility costs, but it might be a bit daunting at first. The good news is that when you select a new energy-efficient furnace, you may be qualified 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 get the tax credit, you must select a furnace that has earned the ENERGY STAR label. Keep in mind it can’t be a furnace that is labeled ENERGY STAR for “U.S. South Only.” When looking for furnace replacements, watch for solutions with the ENERGY STAR rating so you can be certain you’re picking a high-efficiency furnace.

At KDM Service Corporation, we’ll help you select a solution that meets your needs and helps you qualify for this tax credit. While ENERGY STAR products indicate high efficiency, it’s important to check the furnace you pick 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.

Qualifying for the tax credit will not be the only savings you’ll receive when you purchase a new high-efficiency furnace. Some of the most efficient products can save you hundreds of dollars on your energy bills during the year. And you’ll also have greater confidence in your HVAC system to maintain your indoor space at just the right temp.

If you think of questions about your eligibility for a tax credit, or if there are other local savings you may be eligible for by getting a new high-efficiency furnace, give our teams at KDM Service Corporation a call at 205-208-8090. You could also visit ENERGY STAR or contact your local utility establishment if you have questions about other eligible home products.