Great news for Alleghany County, NC! Homeowners who install geothermal heating and cooling systems are eligible for increased tax incentives
under the American Recovery and Reinvestment Bill of 2009.
Under the previous legislation, a one-time tax credit of 30 percent of the total investment was offered for residential ground loop or ground water geothermal heat pump installations, with a maximum credit of $2,000 for a single residence. The new bill removes the $2,000 cap and offers homeowners the entire 30 percent tax credit. Commercial building systems installed after October 3, 2008, are also eligible for a credit of 10% of the total investment.
The new tax credits are retroactive to Jan. 1, 2009 and expire on Dec. 31, 2016. Residential systems installed Jan.1, 2008 through Dec. 31, 2008, are also eligible for the 30 percent tax credit, but they are subject to the provisions of previous legislation, including the $2,000 cap.
In order to qualify for this tax credit, your residential system must meet Energy Star requirements. You can file for the credit by completing form 5695 – the Residential Energy Efficient Property Credit – on your 2009 tax return. No proof of purchase is required. In the event of an audit, however, you’re encouraged to keep on file a detailed invoice of your purchase. If we at Evans Heating & Cooling sold and installed the product, we’ll list your purchase as a “Geothermal Heat Pump” on the invoice and note that the unit “Meets or exceeds requirements of the Energy Star program currently in effect.”
Today, more than half a million homes across the United States benefit from geothermal systems. The growing popularity of these systems is fueled by soaring energy prices and the number of homeowners looking to reduce their carbon footprints.
Tim Shields, WaterFurnace International Chairman of the Board, believes that Congress’s encouragement to use geothermal energy will have far-reaching effects. “Geothermal heat pumps and the renewable heat exchangers in the earth are made in the U.S.,” he says. “Every system installed requires skilled U.S. labor, and more installations mean more jobs. This is truly a homegrown solution to the energy crisis and a very good way to address the financial crisis at the same time.”
To learn more about the new federal tax credits, visit http://www.dsireusa.org
or contact your local tax professional.