There are multiple potential tax savings alternatives for HVAC purchases:
New Buildings - Utilizing EPAct 179D
New Buildings can utilize EPAct HVAC tax deductions. There are 19 HVAC technologies that tend to qualify:
- Geothermal (Ground Source Heat Pumps)
- High Efficiency Water Source Heat Pumps
- Thermal Storage
- High Efficiency VRF units in Rental Apartments/Dorms/Hotels
- Centralized HVAC in Rental Apartments/Dorms/Hotels
- Energy Recovery Ventilation
- Demand Control Ventilation
- VFD’s on all major Motors and Compressors
- Chillers in buildings < 150,000 sq ft
- Direct fired heaters in no AC Industrial Spaces
- Industrial Space >75,000sq ft with Constant Volume Package unit
- VAV (variable air volume devices) in buildings <75,000 sq ft
- Chilled Beam
- McQuay Magnetic Bearing Chillers
- Smardt Chillers
- Arctic Cool Chillers
- Gas fired chillers combined with electric chillers to peak shave
- Coolorado in dry climates
- Combined Heat and Power
Existing buildings can qualify for EPAct by implementing the strategies described above or for replacement tax opportunities described below. Note: qualification for HVAC EPAct tax services is highly dependent on the underlying circumstances of the space.
- Qualified Package Unit
Replacement Expensing (Q-PURE) utilizes guidance from proposed IRS REG-168745-03
as well as precedence set by numerous tax court rulings
to allow for the expensing of replacement HVAC package units that meet
certain qualifying characteristics.
- Using typical present value analysis techniques it is equivalent to a 20% discount on the cost of replacing the unit (Equipment and Labor).
- Qualified Chiller Unit Replacement Expensing
- Qualified Rooftop Replacement Expense Deduction
Data specifications for these products and more detailed descriptions are available on request.