Is Your HVAC Upgrade or Repair Tax Deductible?
This is a commonly asked question, and while the answer for “Are my HVAC repairs tax deductible?” is a straightforward no, an HVAC upgrade needs a bit more clarification. We’ll explain what kind of improvements are considered tax-deductible and at what point you can claim them.
First, we want to explain the difference between an HVAC repair and an HVAC upgrade. The easiest way to think of it is this: if the work performed simply returns the unit or system to its original state, it is considered a repair. If the work done to the unit or system adds value, surpassing its original worth, then it is an improvement.
Although, don’t feel as though you have to think about improvements in terms of resale value. Whether your motivation for upgrading your system is to benefit your family or the next, it’s an improvement. That being said, keep detailed records and receipts of the work that has been performed, even if you don’t intend to sell anytime soon. It has the potential to pay off in the future.
2025 Federal Tax Guidelines for HVAC Improvements
The Energy Efficient Home Improvement Credit expired on December 31, 2025. The program was accelerated from its original 2032 end date due to the passage of the “One Big Beautiful Bill” in July 2025. If you installed qualifying HVAC equipment in 2025, you can still claim the credit when filing your 2025 taxes in early 2026.
HVAC Upgrades Moving Forward in 2026
Even without the federal tax credits, upgrading to a high-efficiency HVAC system can still make financial sense and benefit more than just your home. New energy-efficient systems can:
- Significantly lower your monthly energy bills
- Reduce repair costs and extend equipment lifespan
- Increase your home’s resale value
- Improve comfort and indoor air quality
- Benefit the environment through reduced energy consumption
While federal credits past 2025 have ended, you can still save when purchasing a qualifying Lennox system. Check with AeroDS on current promotions and incentives.
Keep Detailed Records of Your HVAC Upgrades
Whether you’re considering selling soon or not, you should always keep detailed records and receipts of any upgrades done to your home. For HVAC work, you should keep a record of:
- Installation dates and invoices
- Equipment specifications and efficiency ratings
- Manufacturer documentation
- Maintenance records
- Any warranty information
These records can help you when it’s time to sell your home by demonstrating the value-added improvements you’ve made.
Contact AeroDS for Your HVAC Needs
Feel free to contact us for more information about the HVAC systems we recommend and how they can benefit your home’s comfort and efficiency. While the federal tax credits have ended, don’t let that stop you from an HVAC upgrade in 2026. Investing in a quality, energy-efficient HVAC system remains a smart financial decision for your home.
Important Disclaimer: AeroDS is not a tax professional and does not provide tax advice. The information above is provided for general educational purposes only. This information was gathered from publicly available information from the IRS and Energy.gov. Please consult with a qualified tax professional or accountant regarding your specific tax situation and eligibility for any credits or deductions.
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