We converted our electric furnace to a natural gas furnace and spent roughly $10,000. We did not receive credit for this investment. Can you please explain why?

[CynthiaR · Accepted solution]

Residential Energy Tax Credits have been suspended for the years 2018 to 2025.  See below.

Nonbusiness Energy Property Tax Credit (Expired December 31, 2017)

For tax years prior to 2018, equipment and materials can qualify for the Nonbusiness Energy Property Credit only if they meet technical efficiency standards set by the Department of Energy. The manufacturer can tell you whether a particular item meets those standards. For this credit, the IRS distinguishes between two kinds of upgrades.

The first is "qualified energy efficiency improvements," and it includes the following:

• Home insulation
• Exterior doors
• Exterior windows and skylights
• Certain roofing materials

The second category is "residential energy property costs." It includes:

• Electric heat pumps
• Electric heat pump water heaters
• Central air conditioning systems
• Natural gas, propane or oil water heaters
• Stoves that use biomass fuel
• Natural gas, propane or oil furnaces
• Natural gas, propane or oil hot water boilers
• Advanced circulating fans for natural gas, propane or oil furnaces

New energy credits are:

• Solar panels, or photovoltaics, for generating electricity. The electricity must be used in the home.
• Solar-powered water heaters. The water heated by the system must be used inside the home, and at least half of the home's water-heating capacity must be solar. (Solar heaters for swimming pools and hot tubs do not qualify.)
• Wind turbines that generate up to 100 kilowatts of electricity for residential use.
• Geothermal heat pumps that meet federal Energy Star guidelines.
• Fuel cells that rely on a renewable resource (usually hydrogen) to generate power for a home. The equipment must generate at least 0.5 kilowatts of power.

[NewInquirer]

What answer was received?   I am wondering if I can get a credit for my new heating/air conditioning system.

[Hal_Al]

Q.  I am wondering if I can get a credit for my new heating/air conditioning system on my 2020 tax return.

A.  No. There are no more credits for  that type of improvement.

This is an old  thread. There were  energy credits for certain types of residential improvements a few years ago.  Even then, not every new  heating/air conditioning system qualified. 

Check with your utility (usually the electric company). Some of them give rebates for certain improvements

[Hal_Al]

Latest from the IRS on this subject

https://www.irs.gov/newsroom/energy-incentives-for-individuals-residential-property-updated-question...