As you think about upgrading your home’s heating and cooling system, you may want to make now the time to focus on energy-efficient upgrades. A variety of energy–efficient home improvement credit options exist, and there are various opportunities to consider.
Take a look inside the Energy Efficient Home Improvement Credit to find out how you can reduce your taxes, upgrade your heating and cooling, and save money on energy costs this year with the help of an AC repair company in Las Vegas, NV.
Breaking Down the Energy Efficient Home Improvement Credit
As a homeowner, upgrading your home’s heating and cooling is likely something you will need to do over time. Doing so now could help you take advantage of the Energy Efficient Home Improvement Credit, a federal home energy tax credit from the Internal Revenue Service.
This applies to home improvements that meet specific requirements installed after January 1, 2023. The credit provides you with up to a 30% credit from qualified expenses such as:
- Home energy audits
- Residential energy property
- Qualified energy efficient improvements installed in the tax year you claim them
There are a variety of factors to consider to qualify, but you can use this tax credit on an existing home you improve or add onto, though it does not apply to new home construction. Your home must be in the US, and it only applies to your primary residence. You cannot use it for investment property or on any home the owner does not live in.
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The Maximum Credit Allowable for This Tax Credit
There is a limit on the amount of tax credit you may obtain. Be sure you contact your tax professional if you are unsure if you qualify for a tax credit. The maximum amount of tax credit you can claim each year is:
- $1,200 for energy–efficient property costs and some types of energy-efficient home improvements. There are limits on some costs ($250 per door or $500 total for doors, $600 for exterior windows and skylights, and $150 on home energy audits.)
- $2,000 on qualified heat pumps, water heaters, biomass boilers, or biomass stoves.
While these limits apply each year, there is no lifetime dollar limit, meaning you can claim more the next year. That means you can continue to make improvements to your home and take advantage of this tax credit each year as long as you are making home improvement upgrades of that quality.
Also note that this is a non-refundable tax credit, which means that you cannot get back more on your taxes than you owe.
What Types of Home Energy Upgrades to Consider
You have numerous potential options to consider. When it comes to residential energy property, the upgrades must meet or exceed the Consortium for Energy Efficiency (CEE) highest efficiency tier, and it cannot include any advanced tier.
That can be confusing, but our team at Ambient Edge can help you navigate which types of systems may qualify and work to meet your needs, though this may include:
- Qualified central air conditioning systems
- Qualified natural gas, propane, or oil water heaters
- Qualified natural gas, propane, or oil furnaces and hot water boilers
Additionally, heat pumps, biomass stoves, and boilers may qualify if they meet CEE’s highest efficiency tiers. This includes the cost of the system and installation labor.
Qualified electric or natural gas heat pumps, heat pump water heaters, and biomass stoves and boilers may be an excellent way to add value to your property. You can find more information about this in our FAQs section.
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How to Find Out if You May Benefit from This Tax Credit
While we cannot provide tax advice, we can tell you about the benefits of investing in your home’s heating and cooling systems.
Over time, these systems help protect the environment and may also make your home more comfortable. Many times, they also save you money on your energy costs year after year.
We recommend consulting our team to find out if you would benefit from an upgrade to any of your major home systems that we service.
If your home is newer or you recently just installed a brand-new heating and cooling system, upgrades may not offer benefits to your bottom line. However, if any of the following apply to you, give us a call for a consultation:
- Your system is more than 20 years old
- Our team has been out more than once to repair your system
- Your energy costs continue to rise
- There are significant repairs necessary to your existing system to bring it up to code or to get it working again
- It would cost more to repair your current system than to replace it with an energy-efficient model
- You are planning to do a significant remodeling or upgrade of your home that could extend the home’s square footage, requiring a more powerful system
- You are adding onto your current heating or cooling system to unventilated areas, such as garage spaces
Let Us Provide You With a Quote for More Information
Our technicians would be happy to visit you to provide a full inspection and determine if now is the right time for you to upgrade your home’s heating and cooling system.
Many times, property owners will benefit from a frank conversation about the length of life left in their existing system, just how much energy is being lost, and what steps they can take to improve the efficiency of their current system.
We are always upfront with you about any type of upgrades that are worth it and those that may not be worth it, and all of our work is backed by our 5-star satisfaction guarantee.
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Set Up a Consultation with Ambient Edge to Learn More About Your Options
The Energy Efficient Home Improvement Credit is a desirable tool for property owners who want to improve their homes’ efficiency and lower their tax obligations.
Contact Ambient Edge now to schedule a consultation with our team. Let us determine how you could benefit from this tax credit as soon as this year.
