2024 Tax Credits for HVAC Systems and Equipment

The Inflation Reduction Act (IRA) of 2022 allocates funding for federal programs aimed at providing tax credits and rebates to incentivize the installation of new or upgraded HVAC equipment. While the primary focus lies on offering substantial rebates for households opting for multi-zone mini-split heat pump systems, there are also provisions catering to various other HVAC-related enhancements. Additionally, upgrades to electrical circuit boxes and wiring may also fall under qualifying improvements, providing further opportunities for eligibility.

The IRA utilizes the existing Energy Efficient Home Improvement Credit program for HVAC upgrades. This program allows Georgia homeowners to claim a tax credit equal to 30% of the total cost of qualified HVAC equipment, with some limitations.
 

Qualifying Installed Equipment and Their Credit Limits:

• Central Air Conditioning Systems: $600
• Heat Pumps: $2,000
• Natural Gas Water Heaters & Furnaces: $600
• Biomass Stoves and Boilers: $2,000
• Electrical Panels and Related Equipment: $600
• Insulation and Air Sealing: $1,200

Key Points to Remember:

• This program is active from January 1, 2023, to December 31, 2032
• The credit applies to the cost of the equipment and installation
• There's an annual limit of $1,200 for all qualifying home improvement projects, including HVAC
• You can claim the credit on your federal tax return
  
   

Who Can Qualify for the HVAC Tax Credits?

To qualify for the energy-efficient home improvement tax credit, you must make improvements to your primary residence, which is typically where you reside for the majority of the year. Here are the eligibility criteria:

• Location: The home must be located within the United States
• Existing Home: The tax credit applies to improvements made to an existing home, not to new constructions or properties
• Primary Residence: In most cases, the home must serve as your primary residence, where you live for the majority of the year. Landlords or property owners who do not live in the home as their primary residence are not eligible to claim the credit

By meeting these criteria, homeowners can qualify for the energy-efficient home improvement tax credit when upgrading their HVAC systems or making other qualifying improvements to their primary residence. If you are considering a new heating & cooling system for your home, or other equipment that might apply, Coolray’s expert technicians will take the time to answer questions and recommend the best options for your specific needs.

Please note that the content presented in this article is intended for general informational purposes only. Specific details regarding the tax credits can be found here: https://www.irs.gov/credits-and-deductions-under-the-inflation-reduction-act-of-2022