3/23/2021

Not only can you save money by replacing your existing air conditioner with a newer, more efficient unit. But did you know that you can also save on taxes by purchasing a new unit?

Last year, in 2020, the government extended the previously-expired Non-Business Energy Property Tax Credits for purchasing new residential air conditioning equipment. As of January of this year, 2021, the Tax Credit was extended again. So until December 31, 2021, air conditioners meeting certain qualifications are again eligible for a $300 tax credit.

This tax credit also retroactively applies to new air conditioners installed in the 2018-2020 tax years. So if you have not claimed this tax credit before, consult with your tax preparer for details.

The systems that qualify must be:

   •   Split Systems must have a Seasonal Energy Efficiency Ratio  (SEER) of 16 or greater, and an Energy Efficiency Ratio (EER) of 13 or greater.
   •   Packaged Systems must have a SEER of at least 14, and an EER (Energy Efficiency Ratio) of 12 or greater.
   •   Most air conditioners carrying the designation of ENERGY STAR Most Efficient will meet the tax credit requirements.

This $300 tax credit can only be claimed for the energy efficiency improvements of a new air conditioning unit are only available to residential properties with the following two caveats: ​

   •   The residence must be your primary residence rather than a vacation home, second home, commercial property, etc.
   •   The residence must be an existing home, not new construction.