Geothermal Tax Credits for New Jersey Residents

Looking to save big bucks on the installation of that geothermal heating and cooling system you’ve always dreamed of? Well, this could be the time!

The Bipartisan Budget Act of 2018, signed in February 2018, reinstates the Residential Energy Efficient Property Credit for fuel cells, small wind systems … and geothermal heat pumps. As far as the latter are concerned:

  • This credit will be in effect from now through December 31, 2021.
  • It pays back 30% of pre-identified expenditures for systems placed in service between now and December 31, 2019.
  • A gradual reduction in credit value is scheduled for each successive year, so if you want the initial 30% credit, you’ll have to take action fast.
  • Retrofit systems are considered “placed in service” when they’re completely installed and ready for use.
  • Systems for newly constru|ere]36]cted or newly renovated homes are considered “placed in service” at the time you, the homeowner, first occupy the home.
  • The home does not have to be your main residence.
  • Your geothermal heat pump must fulfill all federal ENERGY STAR specifications.
  • To claim the Residential Energy Efficient Property Credit, you’ll need to finish and file IRS Form 5695.

For additional information, check out our blog as well as this WaterFurnace®-produced circular, Understanding the Federal Incentives for Geothermal Heat Pumps.

While we at J. Zanes LLC would like to see you purchase a geothermal heating and cooling system for your New Jersey home, we cannot legally sanction any financial tactics for doing so. We can, however, recommend that you consult with a local tax professional. He or she can counsel you on how best to capitalize on geothermal tax credits considering your unique financial situation.

If you’d like to find out more about what other energy-related tax incentives might be applicable to you at the federal, state, and local levels, check out dsireusa.org. This is a one-of-a-kind resource that’ll give you state-by-state facts on heaps of policies and incentives designed to advance  renewable energy and energy efficiency.

And bear in mind: When you finally decide to install a geothermal heating and cooling system in your home, turn to the New Jersey geothermal specialists at J. Zanes LLC. We’ll get the job done right – to help you start saving both energy and money right from the start.