Geothermal Tax Credit Reinstated – Retroactive to 2017

As part of the tax bill passed on Friday, February 9, Congress reinstated the federal geothermal tax credits for residential and commercial use.

Residential Geothermal Tax Credit

The residential credit (detailed below) applies to residential systems installed from January 1, 2017 through December 31, 2021.

Installation Year Tax Credit
2017 30%
2018 30%
2019 30%
2020 26%
2021 22%

Commercial Geothermal Tax Credit

The bill modifies language related to how commercial geothermal systems qualify for tax credits. Under the new bill, a commercial project becomes eligible for the tax credit in the year it commences, rather than the year the project’s system is placed into service.

For commercial geothermal systems, there is a 10% Federal Income Tax credit, which can be combined with solar and wind tax credits and energy-efficient building deductions.

What does this mean for you?

  • If you did geothermal installations in 2017, make sure those customers are aware that the credit has been reinstated. The IRS will post details here on how to claim this credit.
  • For commercial contractors, use this new rebate information to evaluate if geothermal may become a more viable solution for upcoming projects.
  • For residential contractors, make sure you’re leveraging the rebates in your marketing for geothermal. If you’re an HVAC Distributors customers and need help with your geothermal marketing, reach out to us.

HVAC Distributors is a ClimateMaster geothermal distributor for Pennsylvania and New York. Through HVAC Commercial Solutions, HVAC Distributors has access to ClimateMaster’s commercial line.

You can order qualifying product at any of our HVAC Distributors locationsby phone or through Web Order Entry.

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