Top Ten Reasons For Geothermal:
- Lower total energy usage & lower “carbon footprint”
- Lower operational costs from conventional heating and A/C systems
- Can be combined with solar to minimize or eliminate all heating & cooling costs!
- Cleaner system – no combustion, no venting
- Safer than conventional systems – no flames, no storage tanks
- Longer lifespan – all equipment is indoors, fewer parts which can fail, long warranties
- Lower maintenance – especially closed loop systems
- Very quiet – (If installed properly) especially with soft start
- No noisy and ugly equipment outside
- Better air quality inside with lower humidity – (longer run times, fully variable or dual speed compressors)
- Federal Tax Incentive available (see below) – 30% tax credit for entire system on residential geothermal applications
Geothermal Tax Credits
An exciting tax credit is currently available for home and commercial building owners who install geothermal heating and cooling systems through the Energy Improvement and Extension Act of 2008 (H.R. 1424).
This offers a onetime tax credit of 30% of the total investment for homeowners who install residential ground loop or ground water geothermal heat pumps. A credit of 10% of the total investment is also available (no maximum) for a commercial system installation.
To qualify, the systems must meet or exceed EnergyStar requirements and be installed between 12/31/07 – 12/31/16.
Owners can file for the credit by completing the Renewable Energy Credits subsection on their tax returns. For taxpayers that are subject to the Alternative Minimum Tax, they can claim the credit on their taxes for the following year. No proof of purchase will be required; however, in case of an audit, owners are encouraged to keep a detailed invoice of their purchase on file. The contractor who sold and installed the product should list the purchase as a “Geothermal Heat Pump” on the invoice and that it “Exceeds requirements of Energy Star program currently in effect”.
Consult your local tax professional for advice on taking advantage of the tax credit, as this announcement is not intended as a recommendation or endorsement of any financial strategy.