Geothermal Tax Credits for Denver Residents

Looking for significant savings on the installation of that geothermal heating and cooling system you’ve long longed for? Well, this could be the time!

The Bipartisan Budget Act of 2018, passed in February 2018, reinstates the Residential Energy Efficient Property Credit for fuel cells, small wind systems … and geothermal heat pumps. Regarding the latter:

  • This credit applies from now through December 31, 2021.
  • It pays back 30% of designated expenditures for systems placed in service between now and December 31, 2019.
  • A measured step-down in credit value is slated for each successive year, so if you’d like the initial 30% credit, you’ll have to move quickly.
  • Retrofit systems are accepted as “placed in service” when they’re totally installed and ready for use.
  • Systems for newly built or newly renovated homes are counted as “placed in service” at the time you, the homeowner, take occupancy of the home.
  • It’s not necessary that this home be your primary place of residence.
  • Your geothermal heat pump must fulfill all federal ENERGY STAR specifications.
  • To claim the Residential Energy Efficient Property Credit, you should fill out and file IRS Form 5695.

For more specifics, see our blog as well as this WaterFurnace®-created circular, Understanding the Federal Incentives for Geothermal Heat Pumps.

Though we at Sensible Heating & Cooling would be pleased to see you get a geothermal heating and cooling system for your Denver home, we cannot legally support any financial strategy for doing so. We can, however, recommend that you consult with a local tax professional. He or she can advise you on how best to capitalize on geothermal tax credits given your singular financial situation.

If you want to find out more about what other energy-related tax incentives might apply to you at the federal, state, and local levels, go to This is an unusual resource that has state-by-state information on heaps of policies and incentives advancing  renewable energy and energy efficiency.

And don’t forget: When you’ve finally decided to install a geothermal heating and cooling system in your home, turn to the Denver geothermal specialists at Sensible Heating & Cooling. We’ll get the job done right – to help you start saving both energy and money right from the start.