Federal tax credits are in effect for 2009 and 2010. The purchase of a new central air conditioner may qualify for a credit. It must be installed in your principal residence between January 1, 2009 and December 31, 2010. The unit may qualify for a tax credit of up to 30% of the cost (including installation/labor costs), up to $1,500 for 2009 and 2010 combined. Tax credits are available in 2010 (ONLY for existing homes, NOT new construction, which is your principal residence).
The new air conditioner does not have to replace an old one to qualify but it must meet specific guidelines. They are Split Systems: SEER >= 16 & EER >=13 and Package systems: SEER >= 14 & EER >= 12. Note: It is likely that you will have to replace your furnace as well to get an air conditioner that qualifies.
Qualified Models
Unfortunately, a consumer-friendly list of all tax credit eligible Central Air Conditioners (CACs) does not exist. The best way to find tax credit eligible central air conditioners is to ask your HVAC (Heating, Ventilation and Air Conditioning) contractor. To verify tax credit eligibility, ask your HVAC contractor to provide the Manufacturer's Certification Statement for the equipment you plan to purchase. You could also search the Manufacturer's website.
How to Apply
File Tax Form 5695 with your tax return. Enter the cost of your qualified unit on line 3a, "Energy efficiency building property". You must have a Manufacturer’s Certification Statement to qualify.
