Residential energy-improvement tax credits in the U.S. have been in place since 2005, and they are set to expire in December 2016. Over the past decade, the 25C credit for high-efficiency HVAC equipment has been extended and modified multiple times, but no one can be sure it will be renewed after the presidential election is over.
Building owners, designers, and contractors considering a geothermal heat pump system may now determine the associated federal tax credits, using Carrier’s new white paper, “Geothermal Heat Pump Systems and Federal Tax Incentives.”
Not all energy-efficient HVAC equipment qualifies for tax credits, but there are four renewable energy product categories that do — geothermal heat pumps, small wind turbines, solar energy systems, and fuel cells. Though some seem beyond HVAC, they each have the potential to bring new revenue streams to contractors.
For the time being, the 25C residential energy tax credit has officially expired. Since many HVAC residential contractors used the tax credit as a selling tool, there has been a lot of discussion about how the expiration will affect the industry, and if there is any hope for an extension of the credit.
The 25C tax credits have been a popular sales tool for residential HVAC contractors since their introduction in 2006. Late last year, Congress extended the credits through 2011, and now many in the industry are wondering if Congress will extend the credits again for 2012.
When the U.S. government offered up to $1,500 in tax credits for higher efficiency appliances, HVAC contractors got their foot in the doors of consumers who might not normally have considered buying high-end. Since the tax credits were reduced in 2011, the same selling opportunities have dried up too — or have they?
What once was an inviting $1,500 tax credit is now a return to the traditional selling methods of explaining features and benefits of high efficiency products to homeowners. While it may be necessary to shift gears to a new selling strategy, some things still remain the same.