Michigan Energy-Savers Celebrate:
30% Federal Geothermal Tax Credit Reinstated!

You know that clean-running, low-maintenance, incredibly energy-efficient geothermal heating and cooling system you’ve been dreaming about but couldn’t afford? Well, despair not! Because, as of February 2018, the federal government’s 30% geothermal tax credit is reinstated! And what was heretofore a financial impossibility may now be well within your means, be it for a new home you’re building in Michigan or for the enhancement of your existing home. You’ll have to act soon, though, because the federal tax credit amount has been set up to drop from year to year through 2021.

Here are the principle facts:

  • A full 30% of the ultimate cost of your geothermal system is covered by this credit through 2019. In 2020, then, only 26% of the total cost is covered. And in 2021, only 22%.
  • The federal geothermal tax credit can be applied retroactively to installations that are “placed in service” as of January 1, 2017, or beyond. A geothermal heating and cooling installation is generally regarded as having been “placed in service” when it’s completely installed and ready for use. That said, your system is part of a newly built or newly renovated home, it’s deemed to be “placed in service” when you start living in the home.
  • What’s eligible for the tax credit is geothermal equipment that, a) uses solar energy stored in the ground for heating and cooling and, b) fulfills all ENERGY STAR requirements at the time of installation.
  • Covered expenditures take into account labor for onsite preparation, assembly, or original system installation and for the piping or wiring that hitches your geothermal system to your home.
  • There is no limit to the credit amount.

Need more specifics? WaterFurnace® has collected them for you in this brief but comprehensive bulletin, Understanding the Federal Tax Incentives for Geothermal Heat Pumps. And, of course, your Michigan geothermal pros at Kozy Home Heating & Cooling (aka AllTemp Comfort) will be glad to answer any questions you have about this generous new opportunity to put geothermal heating and cooling to work for you – affordably!