You can save money on your taxes if you replace your old air-conditioning unit with a new, approved model.
Replacing an outdated central air-conditioning unit not only will save you money on your energy bill, but it also will affect your tax bill. The government has increased a tax-credit program to encourage homeowners to invest in energy-saving products. Tax credits are a particularly valuable tax benefit, because they directly reduce your tax bill rather than merely being deducted from your income.
Instructions
1. Review the energy-efficiency tax credit savings available. The American Recovery and Reinvestment Act of 2009 introduced energy-efficiency tax credits for 30 percent of the total cost to purchase an energy-efficient central air-conditioning unit. This tax credit allows 30 percent, with a maximum limit of $1,500, of an air-conditioning unit's costs to be credited back to consumers via their federal tax returns. For example, a unit that costs $3,000 will be eligible for a $900 tax credit. Any unit exceeding $5,000 is subject to the maximum eligible credit of $1,500.
2. Look for specific energy-efficient models when selecting a new air-conditioning unit. The U.S. government has specific standards an energy-efficient air-conditioning unit must meet to quality for a tax credit. Different requirements are mandated in either a split or package air-conditioning system. Split-system central air-conditioning units must have an Energy Efficiency Ratio (EER) greater than 13 and a Seasonal Energy Efficiency Ratio (SEER) greater than 16. Package central air-conditioning systems must have an EER greater than 12 and a SEER greater than 14.
3. Buy and install your new energy-efficient central air-conditioning system and save all your receipts.
4. Save the manufacturer's certification statement from your energy-efficient central air-conditioning system. This certification should be included with your purchase. The Internal Revenue Service will not require the certification to be filed with the taxes, but it does recommend keeping the certificate with your tax records. The certificate proves that you have purchased the correct product to qualify for the energy-efficiency tax credit.
5. File for a tax credit by including the proper forms with your federal tax return.
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