Thursday, April 16, 2009

Q: **Update** How does the Advanced Main Circulating Fan credit work?

A: The stimulus bill expanded the tax credit for advanced main circulating fans from a straight $50 credit for any furnace equipped with such a fan to 30% up to $1,500 for advanced main circulating fans that account for less than 2% of the furnace's total annual energy used (based on standard Department of Energy test procedures). There remains uncertainty how the credit can be claimed on an advanced fan installed as part of a non-qualifying furnace (less than 95% AFUE). HARDI just received indication from the IRS that they are currently intending to interpret this credit to mean that any advanced fan-equipped furnace that has less than a 95% AFUE can only qualify the costs specific to the advanced fan, not the entire furnace, for the tax credit. Equipment manufacturers are currently pursuing and expedited official IRS clarification that will hopefully provide concrete certainty soon, but the latest indication is that only the costs specific to the advanced fan will qualify for the tax credit on furnaces less than 95% AFUE. HARDI advises that members refer to their tax professionals before recommending to customers what will and will not qualify for this tax credit.
Posted by Talbot Gee at 4:11 PM

4 comments:

  1. UnknownMarch 5, 2009 at 1:56 PM

    Can this credit be used for GE ECM
    evergreen motors installed in existing furnaces

    ReplyDelete
  2. Talbot GeeMarch 5, 2009 at 6:10 PM

    Unfortunately, no. The U.S. Department of Energy has not developed a test procedure for aftermarket motors so the electrical efficiency of advanced fans can currently only be measured when testing as in a completed furnace.

    ReplyDelete
  3. Keith HillMay 29, 2009 at 10:38 AM

    Any comment on the Energy Star website FAQ update - IRS verbal statement: "If the furnace is qualified, but the fan is not (this will be rare), then you also will need to ask your HVAC contractor to break out the cost of the fan and the furnace. You can take the 30% tax credit on the cost of the furnace only". Does this mean that a 95% furnace with a PSC motor will not qulify for the full 30%?

    Keith Hill

    ReplyDelete
  4. Talbot GeeMay 29, 2009 at 11:00 AM

    No, any 95% AFUE or better furnace will qualify for the full 30% credit up to $1,500 regardless of its motor.

    ReplyDelete

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