Can I Receive a Tax Credit for My New Furnace?

For many homeowners, there usually seems to be a long list of home improvement projects that they need to do or new ideas they’d like to try. While a handful may not be necessities, furnace replacement is one project that might be vital to keeping your home comfortable throughout the winter months in Lodi.

Selecting a new furnace is a large investment. You’ll certainly recognize the return-on-investment on your indoor comfort along with your utility costs, but it may be a tad intimidating at first. The good news is that when you pick 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 prolonged through December 31, 2020. In order to obtain the tax credit, you must 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 looking for furnace replacements, look for products with the ENERGY STAR rating so you can be confident you’re picking a high-efficiency furnace.

At Tokay, our team can help you select an option that matches your needs and ensures you qualify for this tax credit. While ENERGY STAR products designate high efficiency, it’s important to clarify that the furnace you choose 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 will not be the only savings you’ll observe when you select a new high-efficiency furnace. A lot of the most efficient models 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 come across questions about 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 experts at Tokay a call at 209-257-3156. You could also visit ENERGY STAR or contact your local utility organization if you have questions about other eligible home products.