Federal Tax Credits - Central Air Conditioning (CAC)

Central Air Conditioning (CAC) The best way to find tax credit eligible CACs is to ask your HVAC Contractor (Heating Ventilation and Air Conditioning). To verify tax credit eligibility, ask your HVAC contractor to provide the Manufacturer Certification Statement for the equipment you plan to purchase. Or, search the Manufacturer's website. Tax Credit: 30% of cost up to $1,500 Expires: December 31, 2010 Details: Must be an existing home and your principal residence. New construction and rentals do not qualify. Requirements Split Systems: SEER ≥ 16 ; EER ≥ 13 Package systems: SEER ≥ 14 ; EER ≥ 12 Tax Credit includes installation costs. Definitions:

• 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.
• Manufacturer’s Certification Statement - is a signed statement from the manufacturer certifying that the product or component qualifies for the tax credit. The IRS encourages manufacturers to provide these Certifications on their website to facilitate identification of qualified products. Taxpayers must keep a copy of the certification statement for their records, but do not have to submit a copy with their tax return.
• 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.
• Split System & Package System - A central air conditioner (or heat pump) is either a split-system unit or a packaged unit. The majority of consumers have split systems in their homes. A split-system central air conditioner has 3 components:
  • an outdoor metal cabinet that contains the condenser and compressor
  • an indoor cabinet that contains the evaporator coil
  • an air handler, that in most cases is part of the furnace or heat pump, that sends the cool air through the duct system
  If your home already has a furnace but no air conditioner, a split-system is the most economical central air conditioner to install. A packaged central air conditioner has the evaporator coil, condenser, and compressor all located in one cabinet, which usually is placed on a roof or on a concrete slab next to the house's foundation. This type of air conditioner also is used in small commercial buildings. Air supply and return ducts come from indoors through the home's exterior wall or roof to connect with the packaged air conditioner, which is usually located outdoors. Packaged air conditioners often include electric heating coils or a natural gas furnace. This combination of air conditioner and central heater eliminates the need for a separate furnace indoors.

More Information

• How to apply
• CAC FAQs