Is it Time to Upgrade Your HVAC Unit?
The federal government recommends that homeowners upgrade/replace air conditioner/heat pump units that are more than ten years old. The main reason for this, according to the Department of Energy and Environmental Protection Agency is “ENERGY STAR qualified air conditioners and heat pumps offer significant long-term energy savings.” Replacing central air conditioning/heat pump units 10 years or older can save at least 20 percent on energy use.
Here is a checklist from ENERGY STAR, that outlines when and why you may need to replace your unit. Among the reasons listed are:
- Your air conditioner/heat pump is more than 10 years old: Older units may not be as efficient. New units can save up to 20 percent on cooling costs.
- You need frequent repairs and your energy bills are going up: Your equipment may have become less efficient.
- Your equipment system is noisy: You could have a problem with the indoor coil of your equipment.
Pay Yourself Back Fast
Upfront costs for your new, energy efficient equipment are offset over time by the energy savings you will see if you choose a high-SEER unit. This payback period (the period of time it takes before a consumer recoups, through lower utility bills, the price increase of the more efficient units) can be trimmed down with government or manufacturer rebate programs.
Some manufacturers offer incentives, such as Carrier’s Cool Choices promotion which awards up to $1,200 in rebates to “consumers who purchase and install a new heating and cooling system in their home—the better the system, the bigger the rebate.”
Look for Energy Efficiency
SEER (Seasonal Energy Efficiency Ratio) is an indicator of how efficient your unit will be. The higher the number, the more efficient the unit and the lower the operating cost. So, it is advisable to shop around for high-SEER units.
Stimulus Tax Credit
How the Program Works
As part of an effort to reduce dependence on foreign sources of energy, the American Recovery and Reinvestment Act of 2009 provides a tax credit to help offset the costs of making energy efficiency improvements to your home. Some key details of the program are as follows:
• The tax credits apply to a variety of products (including installation costs) such as windows, doors, heating and cooling equipment and more.
• The amount of the credit is equal to 30% of the installed cost of the qualifying products, up to a total of $1,500.
• If a qualifying purchase is not large enough to qualify for the maximum credit of $1,500, the remaining available tax credit can be claimed for additional qualifying purchases.
The Economic Advantage of Tax Credits
The reason many homeowners are so excited about this program is because tax credits, unlike deductions, are subtracted directly from the total amount you owe on your personal income taxes. For example, if you complete your tax return and calculate that you owe the IRS $2,000, a tax credit of $1,500 will reduce your tax bill to only $500. Of course, be sure to check with your tax adviser on how to best take advantage of the tax credits.
Tax Credits Available in 2009 and 2010
To take advantage of the American Recovery and Reinvestment Act of 2009 tax credits, you must purchase your qualifying high-efficiency comfort system between January 1, 2009 and December 31, 2010. Better yet, your savings won't be limited to a one-time tax credit. You'll continue saving every month with reduced monthly cooling and heating bills. For more information, contact a Carrier dealer today.
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