Tankless Water Heater Tax Deduction

Certain energy star certified gas water heaters meet the requirements for this tax credit.

Tankless water heater tax deduction.

Requirements for non solar water heaters. Energy star certified gas tankless water heaters cut water heating expenses while also providing continuous hot water delivery. You can claim a tax credit for 10 of the cost of qualified energy efficiency improvements and 100 of residential energy property costs. Tax credits for residential energy efficiency have now been extended retroactively through december 31 2020.

The non business energy property tax credit has been extended through 2020 and made retroactive to cover 2019. That means if you installed a qualifying tankless water heater last year you could get the credit on the return you file in 2020 for 2019. The credit amount for gas oil propane water heaters including tankless units is 300. For the tax year 2020 the credit drops to 26 percent and for the tax year 2021 the credit drops to 22 percent.

300 requirements uniform energy factor uef 0 82 or a thermal efficiency of at least 90. Gas oil propane water heater. Gas tankless models are a great choice for new construction and major remodeling but are also becoming popular as a replacement for gas. The tax credit for builders of energy efficient homes and tax deductions for energy efficient commercial buildings have also been retroactively extended through december 31 2020.

Federal income tax credits and other incentives for energy efficiency. These types of hot water heaters have been around for a while and many models offer a less energy consuming option for keeping a home supplied with hot water. Of that combined 500 limit a maximum of 200 can be for windows. Water heaters account for 12 of the energy consumed in your home.

Tankless water heater tax credits are often part of an initiative to improve a nation s overall carbon footprint or lower average energy use through the tax code. The tax credit for builders of energy efficient homes and tax deductions for. Can i deduct installing a tankless water heater yes if it meets the requirements you can get up to a 300 tax credit for 2015. A tankless water heater tax credit is a government s tax credit to citizens who take advantage of switching to a more energy efficient tankless hot water heater.