Geothermal Tax Credit Instructions

The 30% Geothermal Federal Tax Credit is back, which can save you thousands on installing a system and makes Geothermal more affordable than ever.  If you are replacing a conventional heating and cooling system, be sure to get a quote for Geothermal.

We can not offer tax advice to customers, but we are glad to share what we know. Please consult with a tax professional to understand your individual benefits.*

Tax Credit Amounts

  • From January 1, 2017-December 31, 2019 – 30%
  • From January 1, 2020-December 31, 2020 – 26%
  • From January 1, 2021-December 31, 2021 – 22%

 

Tax Credit Highlights

  • There is no maximum credit. You get the true percentage based on the year you install the Geothermal HVAC system.  It is a direct reduction of your taxes. (see example below)
  • Systems must be placed in service on or before December 31, 2021
  • The geothermal heat pump must meet federal Energy Star criteria. All geothermal systems that we install meet this criteria
  • The tax credit can be taken on any home served by the geothermal system
  • Can be combined with energy efficiency upgrade tax credits
  • Can be carried forward if you don’t have enough tax liability to use the entire credit in one year
  • The tax credit can be used to offset both regular income taxes and alternative minimum taxes
  • A taxpayer will not receive a tax refund for any amount that exceeds the taxpayer’s tax liability for the year

 

Tax Credit Examples*

House A:
I make $60,000 a year
I owe $15,000 in taxes to Federal Government
I installed Geothermal! It cost $30,000 (before rebates)(financing available)
30% of $30,000 is $9,000
I can now subtract the $9,000 credit from the $15,000 and my new tax bill is only $6000!
(If the tax credit exceeds the income tax liability, the remaining balance can be carried forward into future years.)

House B:
I make $30,000 a year
I owe $7,500 in taxes to Federal Government
I installed Geothermal! It cost $30,000 (before rebates)(financing available)
30% of $30,000 is $9,000
I can now subtract the $9,000 credit from the $7,500 and my new tax bill is covered with $1,500 to carry in next year
(If the tax credit exceeds the income tax liability, the remaining balance can be carried forward into future years.)

 

The the tax credits are administered by the IRS. Please contact the IRS with your question:

*Disclaimer: The tax credit information contained within this website is provided for informational purposes only and is not intended to substitute for expert advice from a professional tax/financial planner or the Internal Revenue Service (IRS).

11 Energy Saving Tips

Learn about our top 11 Energy Saving Tips:

  1. Replace your current heating system to Geothermal if older than 15 years 
  2. Seal air leaks and properly insulate to save up to 20% on heating and cooling bills.
  3. Install a programmable thermostat to save up to 10% on cooling and heating costs.
  4. Clean or change filters regularly. A dirty furnace or A/C filter will slow down air flow and make the system work harder to keep you warm or cool.
  5. Use your window shades. Close blinds on the sunny side in summer to keep out the hot sun, and open them in winter to bring in warm rays.
  6. Turn off all lights, appliances and electronics not in use. A power strip can help turn off multiple items at once.
  7. Change to new light bulbs. Reduce energy as much as 80% with today’s increasing number of energy-efficient halogen incandescent, CFLs and LEDs.
  8. Look for the Energy Star label, the government’s symbol of energy efficiency, on a wide range of consumer products to save up to 30% on related electricity bills.
  9. Use low-flow faucets and shower heads to save on water bills.
  10. Install a heat pump water heaters that can cut water heating costs by an average of 50% over standard electric water heaters.
  11. Reduce water heater temperature to 130° F to save energy and money on heating water.

More information about Energy Saving Ideas can be found at the U.S. Department of Energy: Office of Energy Efficiency & Renewable Energy Website

Geothermal Heat Pump information is also available.

Video of Geothermal Heat Pumps might help you out too!

Governor Cuomo Announces New Energy Target

From Original Post:

New Energy Efficiency 2025 Target is Equivalent to Energy Used by 1.8 Million Homes

Energy Efficiency Strategies Will Deliver Nearly One Third of State’s 2030 Greenhouse Gas Reduction Goal

$36.5 Million in Investments Will Prepare up to 19,500 New Yorkers for New Jobs

New Strategies Will Increase Annual Electricity Savings to Over 3% by 2025 Positioning New York as a National Leader in Energy Efficiency

Governor Andrew M. Cuomo today announced an ambitious acceleration of energy efficiency in New York, including a comprehensive plan to achieve a new target for significant greenhouse gas emission reductions, decrease consumer energy costs and create job opportunities.  Meeting the new energy efficiency target will deliver nearly one third of the greenhouse gas emissions reductions needed to meet New York’s climate goal of 40 percent reduction by 2030. This announcement is part of the Governor’s State of the State proposal to develop a milestone Earth Day energy efficiency target and comprehensive strategy.

“Energy efficiency is the most cost-effective way for New Yorkers to lower utility bills, curb harmful emissions and battle climate change,” Governor Cuomo said. “As the federal government abdicates its responsibility to safeguard our environment, we must continue our bold action to reduce emissions and protect all New Yorkers, today and in the future, from the devastating effects of climate change.”

“We’re aggressively working to make New York more energy efficient with unprecedented goals to reduce greenhouse gas emissions and address climate change,” Lieutenant Governor Kathy Hochul said. “The strategies to make our state cleaner and greener will result in high-tech jobs for New Yorkers with investments in workforce development. The focus on energy efficiency will not only enhance the environment and create new jobs, it will also lower energy costs for residents and boost the energy economy.”

Read More

Questions about you can lower greenhouse gas emissions? Call us 716-684-8848 or info@buffalogeothermal.com

Buffalo Geothermal Wins with Siano Building NY-GEO

Buffalo Geothermal Wins 1st Runner Up for TOP JOB at the 2018 NY-GEO Conference for The Siano Building

 

April 18 – 19, 2018 Buffalo Geothermal Heating LLC, attended the New York Geothermal Energy Organization Conference in Albany, NY.  Owner, Jens Ponikau, presented another year on a Top Job submission.  This year we submitted The Siano Building at 363 Grant Street in Buffalo and won 1st runner up. See a video of what we built here.  Congrats to the winner, Larry Lessard of Achieve Renewable Energy LLC for installing a 21st Century Geothermal system in a Historic Mill Building in Massachussetts!

 

WE WON 1st Runner Up!  

When Governor Andrew M. Cuomo announced the grand opening of The Siano Building, located at 363 Grant Street in Buffalo, he emphasized on how the $2.3 million Better Buffalo Fund project had transformed a vacant lot into a 12,600 square-foot, mixed-use building consisting of retail space and 11 apartments utilizing geothermal heating and cooling.
Voted best urban fill-in 2017 by Buffalo Rising Magazine, the building focuses on neighborhood revitalization and sustainability. 
Architect John Wingfelder designed the exterior to include projecting bay windows and fixed store canopies to reflect the uniqueness of this building.  More photos of the Siano Building can be seen on his website
The entire building is exclusively conditioned by geothermal heating and cooling, with each apartment being it having its own heat pump for zone control. In addition, the entire domestic hot water is generated via geothermal, allowing a smaller loop field in this cooling dominated building and reduced upfront costs. A central variable pressure ECM pump adopts to all load scenarios with ultimate efficiency. The entire ground loop is installed under the building, allowing for space saving installation and setting a precedence and example for the application of geothermal systems in dense urban settings.
City Council Member David Rivera said, “Grant Street is the embodiment of diversity, culture and growth here on the Westside. The Better Buffalo Fund is producing projects such as The Siano Building, which will transform this area of Grant Street and fully develop this location to be a healthy and sustainable neighborhood in the City of Buffalo. Walkable neighborhoods that encourage alternative transportation in mixed use development create an environment of smart and collaborative growth that benefits everyone. I want to thank the Better Buffalo Fund, as well as the Siano brothers for their commitment to Grant Street.”

 

 

Top Job Winner Buffalo Geothermal

NY-GEO 2018

 

Buffalo Geothermal Wins Top Job

Buffalo Geothermal Heating Wins NY-GEO ‘Top Job’ Award

The objective of the GeoStar Top Job Competition is to highlight and recognize the incredible talent, creativity and imagination that exists in geothermal system designers and installers. An additional aim is to communicate to those outside the industry the variety of ways that geothermal heat pump technology can be applied. Our job switched 72 low-income apartments in Western New York from electric baseboard heating to 100% geothermal heating, cooling and domestic hot water using shared closed loop fields. Read more.

Image result for top job award buffalo geothermal

“The capstone of the two-day event continues to be the “Top-Job” competition. Among the entries included the impressive St. Patrick’s Cathedral geothermal conversion in Manhattan and the William F. Buck Middle School conversion from the public city water mains in Valley Stream, New York.

With such an impressive list of entries, the decision was difficult for the panel of judges. The 72-unit Lockport Housing Authority geothermal conversion won the day. Jens Ponikau of Buffalo Geothermal in Cheektowaga, New York, worked closely with the housing authority to convert the facility with a small footprint on time and on budget.” – theNEWS

Federal State Tax Credit is Back

A 30% Federal Tax Credit is back for Geothermal Heating and Cooling.  This now makes Geothermal Installation affordable and a second option when replacing your heating and cooling system. A system could cost as low as $14,000 with the tax credit.

These tax credits are retroactive to Jan 1, 2017, meaning homeowners who bought a system last year are eligible for the 30% credit. Credits have been extended to December 31, 2021. They will remain at 30% until December 31, 2019, at which point they’ll begin a phase-out. For 2020, the credit will move to 26% and in 2021 the final incentive will be 22%.

Information from the IRS can be found on their website.  We recommend you consult an accounting or tax professional to file correctly.

400% efficiency and low monthly cost to the system can save a homeowner up to $5000 a year in utilities. No longer do homeowners have to pay a gas or fuel company to provide them comfortable heating.

The IRS has just issued an updated 2017 IRS Form 5695  form and Instructions.

“Geothermal energy systems are a great way for homes and businesses to lower their energy costs, and lower their reliance on fossil fuels.” Assemblyman Sean Ryan

More information about the Federal Tax Credit can be seen at the GroundUp website and the ENERGY STAR website.  A guide to how Geothermal works can help provide information on choosing this option for your home.

The New York State Energy Research and Development Authority (NYSERDA) has up to $15 million available in rebates for the installation of ground source heat pump systems for residences, businesses and institutions. Rebates are only available to qualified installers.

In addition, the current Geothermal Federal Tax credit of 30% can be used to further reduce the system cost up to $7,800 for the homeowner. “This would reduce the final cost to $18,200 with dedicated hot water, and $16,800 without it.” says Andrew Heiligman of Alternative Carbon Energy Systems, Inc. (A.C.E.S. – Energy), another alliance member.

“This is a fantastic opportunity specifically for people who are paying thousands of dollars a year for oil or propane to heat their homes”,  said Bill Nowak, Executive Director of  New York Geothermal Energy Organization.