2017 HVAC Federal Tax Credits

The federal government of the USA has been offering tax credits for a few of the residential HVAC products and systems of certain kinds along with deductions to help promote the saving of energy in different sorts of commercial buildings.

25D Residential Tax Credits

The law that dealt with the federal tax credit and regulations of this kind was the 25D law. It expired on 31st December, 2016. The 25D law allowed a tax payer to claim a credit equaling the amount of 30% of the investment made on some kind of HVAC system that has been serving as a residential unit at a location owned by a tax paying US citizen. The 25D credit has been made available in 2017 and will be valid till 2021; but only for some specific solar energy technologies. The expenditures involved in this regard include the wiring or piping, the original or assembly system installation, labor costs for the preparation of the site, etc.

25C Residential Tax Credits

The 25C residential tax credit is another law devised to take care of residential HVAC related systems and products that were installed within the time frame of 1st January, 2015 to 31st December, 2016.

According to the 25C, the required levels of efficiency reflect the top level tier of CEE high efficiency specification for residential HVAC systems. The improvements made in the year 2015 are supposed to be claimed along with the taxes of 2015 while those made in 2016 are supposed to be claimed with the taxes of 2016. The $500 lifetime credit cap was also reinstated lately. In case you have made a claim for over $500 on account of the 25C tax credit regulations since the 1st of January, 2006, you do not stand eligible to file for any additional credits.

A certification from a manufacturer may be referred to as an endorsed statement issued by the manufacturer of the systems certifying the fact that the components or products used in the system qualify for all of these regulations. The manufacturers are now encouraged by the IRS to come up with the certifications on their official websites in order to facilitate the identification of all the products that fall under the qualification criteria. In addition to this, the tax payers are also being asked to secure one copy of their statement for record maintenance. But it also needs to be noted that the tax payers do not require submitting any of these copies along with their tax returns.

How to Get the Tax Credit?

In order to fall under the eligibility criteria for the tax credit, the tax payers require filling out the IRS form number 8908 to file for it. The IRS bounds the tax payers to provide some guidance regarding their own credentials along with their tax returns so that their case might be reviewed properly. After the submission of these credentials, their cases are reviewed and then they get entitled to the tax credit regulations.