Commercial HVAC Incentives | HVAC contractor | H & H Commercial Services, Inc. Commercial HVAC Incentives | HVAC contractor | H & H Commercial Services, Inc.
What Will Happen To Commercial HVAC Upgrade Incentives For The 2019 Year?
If your aging commercial heating and air system is still running on R22 refrigerant, you’re playing with fire. After January 2020, R22 systems can no longer be repaired, they must be replaced, potentially leading to a backlog of customers waiting on installations. Luckily there is a great tax incentive for your business: The recently passed Tax Cuts and Jobs Act included a provision to allow HVAC products to be immediately expensed. Effective January 2018, under Section 26 U.S. Code § 179 Small Business Expensing, all components of a “heating, ventilation, and air-conditioning” system can be immediately expensed in the first year instead of being depreciated over 39 years. Instead of a measly $350 depreciation for the year (based on old rules), deducting the $14,000 system and installation costs from your 2019 business income could earn you a tax break of $5,000+.
As the above, the Federal Business Energy Investment Tax Credit (ITC) provides a tax credit equal to 10% of expenditures with no maximum for CHP systems up to 50MW capacity exceeding 60% efficiency, subject to some limitations. This does not apply to CHP systems utilizing biomass for 90%+ of system energy, though the credit may be reduced for less efficient systems.
Concerned about new efficiency requirements for rooftop units? Due to environmental and energy concerns, most states offer financial incentives for businesses interested in boosting efficiency, such as New Jersey’s COOLAdvantage and WARMAdvantage Programs, which provide rebates for high-efficiency HVAC systems.
Many states also exempt purchases of energy efficient products from sales or use taxes, or offer special sales tax free holidays for Energy Star-rated products.
Local utility providers also commonly provide rebates and other incentives for energy efficient upgrades and appliance purchases.
What’s Available in Your Area?
Learn more from the U.S. Department of Energy’s DSIRE website and Energy Star.
Interested in learning more about available system upgrade options for your business and incentives available in your area? Schedule a complimentary consultation from a qualified HVAC contractor from H&H Commercial Services today.
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