Tax credits for residential energy efficiency have now been extended retroactively, through December 31, 2020.

When you get a new air conditioner or heat pump and you get your AHRI Certificate showing the SEER rating, it shows on the top if it qualifies for a Federal Energy Efficiency Tax Credit. Your licensed contractor has to pull an AHRI in order to apply for a permit to install or change out your HVAC system.

This is a sample AHRI: http://brownsarticair.com/wp-content/uploads/2020/08/AHRICertificate-3.pdf

It displays the Model numbers, the Manufacturer, but most importantly is the SEER rating, Seasonal Energy Efficiency Rating, which determines if you are eligible or qualify for the Federal Tax Credit. Here is the link about the tax credit:

https://www.energystar.gov/about/federal_tax_credits/non_business_energy_property_tax_credits

Air conditioners recognized as ENERGY STAR Most Efficient meet the requirements for this tax credit.   To verify tax credit eligibility, ask your HVAC contractor to provide the Manufacturer Certification Statement for the equipment you plan to purchase.

Tax  Credit Amount:  $300

Requirements
Split Systems:
SEER>= 16
EER >= 13

Package systems:
SEER >= 14
EER >= 12

SEER (Seasonal Energy Efficiency Ratio)
The higher the SEER rating, the more energy efficient the equipment is. A higher SEER can result in lower energy costs.

EER (Energy Efficiency Ratio)
The higher the EER rating, the more energy efficient the equipment is. This can result in lower energy costs. This DOE site can show how to calculate potential energy cost savings of a more efficient unit.

How Do I Apply for the Tax Credit?

How to apply:

While ENERGY STAR supplies some information about tax credits here, the tax credits are administered by the IRS. You will have to claim the credit using the form below and submitting it with your tax returns to the IRS.

• Form 5695 Instructions: https://www.irs.gov/pub/irs-pdf/i5695.pdfPDF DownloadOpens in New Window
• Form 5695: https://www.irs.gov/pub/irs-pdf/f5695.pdfPDF DownloadOpens in New Window

If you have other questions, please contact the IRS:

• www.irs.gov/contactOpens in New Window
• 1-800-829-1040