Energy Tax Rebates & Credits in 2013: Facts & Fiction about What Qualifies

energy tax rebates 2013 It seems every year hard working American’s search for better ways to get more money back on their Federal Tax returns. However, did you know that if you’re in the market for a new Heating or Air Conditioning unit, or if you purchased an Energy Star® rated unit in 2012, you qualify for a tax credit of up to $500.00 in some cases?

For the 2012 and 2013 tax years, the US Federal Government is rewarding citizens who file taxes with a tax credit for simply being proactive to save energy by using energy efficient Energy Star® rated HVAC units. These energy saving units not only will provide you with more money in tax returns, but also save money each month on your electrical bills – a double win to save you money.

But, just like any other tax rule, there are restrictions and facts which need to be addressed. So, in order to clear up any misconceptions, myths or other fiction about this tax credit for buying Energy Star® rated products, here are some facts vs. fiction about what qualifies for the 2012-2013 Tax Year Energy Star® credit.

FACT #1 – Only certain Energy Star® rated HVAC units apply

Just because something say’s Energy Star® on the product, does not automatically guarantee it to be included in the Tax Credit of 2012 and 2013 tax years. In Fact, it must be one of the following types of HVAC units in order to be considered for the tax credit:

  • Advanced Main Air Circulating Fans; these units are designed to blow the hot or cool air from your heaters or a/c units into your home more efficiently than standard fans. However, they can only use 2% of the total energy of your complete HVAC system. Check with certified HVAC specialists to ensure this item qualifies for the tax credit of up to $50.00.
  • Heat Pump Units; the heat pump units are starting to gain popularity especially in the moderate temperature regions of Arizona. They are designed to simply remove hot air or cool air from your home – providing a balanced temperature in your house year round. They are much more efficient than standard HVAC heaters and air conditioning units and can save you up to $300.00 of a tax credit. (Fine Print Please Read) – The restriction of this tax credit is that these units must be installed in EXISTING homes which are classified as primary residence only. New home or rental properties do not apply for this tax credit.
  • Central Air Conditioning Units; the new Energy Star® rated units of CAC (central air conditioning) are also able to be used for the tax credit for 2012 and 2013. Other units that qualify include; Gas, Propane or Oil hot water heaters, as well as Natural Gas, Propane or Oil Furnaces which are all Energy Star® rated. You can receive up to $300.00 of a tax credit for the purchase of these units.

FACT #2 – You must keep receipts of these products

When you fill your taxes, and declare any tax credit, it is always suggested you keep receipts of these documents; just in case of an audit. It is also advisable that you check with any HVAC installation expert to verify that the unit you are buying qualifies for this tax credit prior to purchase.

Fact #3 – You need to fill out a specific form

The 2012 Federal Income Tax Form 5695 must be filled out in order to receive the Tax Credit for Energy Star® branded products. This form must be attached to your 1040 long or short form, as well as have line #52 filled out with this tax credit on the 1040. If you purchased one of these Energy Star® rated products in the 2012 tax year, you can use this deduction in the 2012 tax return. However, if you purchase one in the 2013 calendar year, you’ll have to wait until next year to file this credit.

It’s important that you know what’s available and how you can best leverage the tax credits for your family, and hopefully you gained some great insight here, but remember, if you have more questions about  air conditioning units and how the energy tax credits are now working, contact the team at Scottsdale Air Heating & Cooling.

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