The Iowa Application for Geothermal Heating & Cooling System Property Tax Exemption is a form that allows homeowners to apply for an exemption from property taxes on geothermal systems. This form is provided by the Iowa Department of Revenue and is used to determine eligibility for the geothermal heating and cooling system property tax exemption. This exemption applies to geothermal systems installed on or after January 1, 2018, and before January 1, 2022, and provides a complete exemption of the property taxes paid on the geothermal system. There are two types of Iowa Application for Geothermal Heating & Cooling System Property Tax Exemption: Residential and Non-Residential. The Residential Application is for homes that are owner-occupied and used as a primary residence. The Non-Residential Application is for homes that are non-owner occupied or used as a rental property.
Iowa Application for Geothermal Heating & Cooling System Property Tax Exemption
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How to fill out Iowa Application For Geothermal Heating & Cooling System Property Tax Exemption?
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FAQ
To acquire a sales tax exemption certificate in Iowa, you need to fill out and submit the appropriate application form to the Iowa Department of Revenue. Ensure that you provide all necessary documentation that supports your claim for exemption. Using the Iowa Application for Geothermal Heating & Cooling System Property Tax Exemption can also streamline your efforts in obtaining these benefits.
Geothermal heat pumps installed on residential property in Iowa are eligible for a tax credit equal to 20% of the Federal Tax Credit. Because the federal tax credit is set at 30%, the state tax credit is equal to 6% of the system cost.
Under the Inflation Reduction Act (IRA) of 2022, the federal tax credit for residential geothermal system installations was increased from 26 to 30 percent, effective January 1, 2023. The 30 percent tax credit runs through 2032 and then gradually reduces until expiring in 2034.
On , President Biden signed the Inflation Reduction Act of 2022 into law which provides a 30 percent credit for geothermal heat pump projects installed before January 1, 2033.
What is the Tax Credit? The renewable energy tax credit covers 30% of the total system cost, including installation, of GeoThermal heat pumps meeting the requirements of the ENERGY STAR program. Under the Inflation Reduction Act in August 2022, the GeoThermal tax credits have been extended through December 31, 2034.
Current Geothermal Tax Incentives The current geothermal heat pump tax incentives are broken down as follows: 30% for property installed between December 2016 and January 2020. 30% for property installed between December 2021 and January 2033. 26% for property installed between December 2019 and January 2022.
Energy tax credit 2023 limits The remaining $2,000 credit is available with any combination of heat pumps, heat pump water heaters, and biomass stoves/boilers. Geothermal heat pump tax credits do not apply toward the limit of $3,200. Energy Star defines the tax credits allowed for geothermal heat pumps.
On average, a homeowner can expect total expenses to reach between $18,000 to $30,000 on geothermal heating and cooling cost. This cost would cover a complete geothermal installation. The price can range from $30,000 to $45,000 with high-end ground-source heat pump systems for large homes.
Geothermal systems are very efficient in Iowa's climate and work as efficiently as those geothermal systems installed in southern zones. As with any heating and cooling system, adequate insulation and weatherization are still key factors in lowering energy consumption.