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Federal Tax Credits
Federal tax credits are available for upgrading your current heating and/or cooling system or for installing a new heating or cooling system. The American Recovery and Reinvestment Act of 2009 allows tax credits for qualified energy efficient equipment installed in 2009 and 2010. Systems can qualify for a non-refundable tax credit under section 25C of the Internal Revenue Code for 30% of the installed cost, up to $1,500. The receipiant of the tax credit must have a manufactures certification stating that the installed equipment meets the criteria for the tax credit in his possession in order to claim the credit
Furnaces
Natural gas or propane furnaces much achieve an annual fuel utilization efficiency rating (AFUE) of not less than 95%. Oil fired furnaces must have an AFUE of at least 90%. Furnaces with fixed speed blowers and variable speed blowers may qualify. Not all furnaces with an energy star rating may qualify for the tax credit
Boilers
Natural gas, propane or oil fired boilers must achieve an AFUE of at least 90% to qualify for the tax credit. Not all energy star rated boilers may qualify.
Air Conditioning Equipment
In order to qualify for the tax credit, the entire system must have a manufacturers certification. This certification is only available for a combination of an outdoor condensing unit, indoor unit and associated furnace or air handler. The air conditioning equipment must have a seasonal energy efficiency ratio (SEER) of at least 16 and an energy efficiency ratio (EER) of at least 13. In general to qualify for this credit, the associated furnace must have a variable speed blower. Retrofitting an existing furnace with an air conditioning package is in general not possible as the manufacturers certification will not be available.
Heat Pumps
Split system air source heat pumps must have a SEER of at least 14.5, a EER of 12 and a heating seasonal performance factor (HSPF) of at least 8.2. Single package air source heat pumps must have a SEER of at least 14, a EER of 11 and a HSPF of at least 8.0
Geothermal Heat Pumps
All Energy Star rated geothermal heat pumps will qualify for the tax credit. They must be placed into service before December 31, 2016. Geothermal systems do not have the $1,500 limitation.
Solar Hot Water
At least half of the energy generated by the ‘qualifying property’ must come from the sun. Homeowners may only claim spending on the solar water heating system, not the entire water heating system. The system must be certified by the Soar Rating and Certification Corporation (SRCC). The water must be used in the dwelling and the credit is not available for heating swimming pools or hot tubs. Solar hot water systems do not have the $1,500 limitation.
State Incentives
Wisconsin has the Focus on Energy program that provides money back for the installation of energy efficient heating and cooling equipment. In general, this program will only be available if the heating or cooling equipment being installed replaces equipment that uses either natural gas or electricity.
Furnaces
A gas furnaces is eligible for a cash back reward of $150 if it is on the pre-qualified equipment list. For a furnace to qualify, it must have a AFUE of at least 90%, have a variable speed blower, have at least two stages of firing, be sealed combustion and be the primary heat source for the home.
Boilers
A natural gas boiler is eligible for a cash back reward of $400 if it is on the pre-qualified equipment list. For a boiler to qualify, it must have a AFE of at least 90%, modulate it firing rate, have an outdoor air reset control, be sealed combustion and be the primary heat source for the home
Air Conditioning Equipment
Air conditioning systems are eligible for a cash back reward of $100 if they are on the pre-qualified equipment lists. They must be installed with a furnace that qualifies for the furnace cash-back reward, have a SEER >= 15, have a thermal or electric expansion valve. For a replacement system, both the condensing unit and the evaporator coil must be replaced.
Heat Pumps
Must meet the same requirements as air conditioning equipment
Geothermal Heat Pumps
Geothermal systems are eligible for $250 cash back if the system has an EER of at least 15, the associated air handler must have a variable speed blower, the heat pump has at least two stages of heat output and the system cannot have electric backup heat. In addition, the system must have a coefficient of performance (COP) of 3.3 for a closed loop system and 3.6 for an open loop system.
Solar Hot Water
Solar hot water systems smaller than 250 therms annual energy production are eligible for $20 per therm with a maximum cost share of 25% or $2,500, whichever is smaller. The system must be approved by Focus on Energy before installation.
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