Tax credits and high velocity air handlers

Discussion in 'Quotes and Proposals' started by shagster, Feb 13, 2011.

  1. shagster

    shagster New Member

    I am interested in getting feedback on high velocity air handlers from both a tax credit and feasibility perspective.

    We are seriously considering installing a Geothermal system in our 70 year old home. The majority of the quotes we have received are for a split sytem - a 3 ton unit for the first floow and basement and a 2 ton system for the top 2 floors. We have primarily focused on WF Envision equipment.

    The house is currently heated by steam, thus there is no ductwork for the first floor. The upper floors were retrofitted with central air and thus have ducwork in place.

    A friend up in PA just had a Geo unit installed. He had similar ducting issues and his contractor recommended and installed high velocty air handling and it worked out very well for them. I was considering the same for serving our first floor as it would greatly reduce space constraints in our basement as compared to conventional ductwork.

    However, I have heard that using a high velocity air handler with the Geo System would negate the 30% federal tax credit, since the air handlers are not energy star rated. I have looked on various web sites and have seen very diverse feedback on what can be deducted on the Federal tax credit.

    Any thought on either including a high velocity air handler in the tax credit application or overall practicality of integrating this system with a Geo unit (beyond my sample of one)?

  2. docjenser

    docjenser Well-Known Member Industry Professional Forum Leader

    The tax credits are linked to the heatpump itself, which must be energy star rated. For the purpose of energy star rating, the distribution system is part of the geosystem. Even if the air handler is not energy star rated, the source for the heat for them still comes very efficient from geo.
    We sometimes have to explain this to inspectors or energy auditors who complain about the buffer tanks, which are not energy star labeled, but are high density foam insulated electric tanks within the thermal envelope of the building, 100 % geo fired.
    Or to some who complain that the hot water lines (100% geo hot water generation) are not insulated, running in the floor joist right next to the radiant tubing, which purpose is to reject heat!
  3. geome

    geome Member Forum Leader

  4. shagster

    shagster New Member

    Thanks for the replies

    So, if I understand your points correctly:

    The Geothermal heat pump property is the qualifying item and the accessories necessary to install it are included in what is eligible for the tax credit - in essence the whole operating system. At some point I heard regulations were amended to require the matched WF air handler, which surprised me, because I thought some Geo equipment suppliers did not manufacture air handlers.

    So, it would be reasonable (and I realize I am not writing to tax attorneys!) to claim a tax credit for an entire geothermal system that included a high velocity air handler necessary to install the system.

    I know there are pros and cons to the high velocity air handlers, too, so they are note a done deal for us, but the high velocity system would make installation and life after installation much more pleasant.

    Please let me know if I have misinterpreted your feedback and thanks again for taking the time to reply!
  5. geome

    geome Member Forum Leader

    You should contact a tax authority for a definitive answer. Manufacturers may be able to provide you with some information, but I wouldn't be surprised if they suggest you speak with a tax expert as well. Let us know how you make out.
  6. shagster

    shagster New Member


    I'll try to get answers from a knowledgeable CPA or two and post the answers.
  7. AMI Contracting

    AMI Contracting A nice Van Morrison song Industry Professional Forum Leader

    High velocity is my least favorite operating system as they are expensive, often louder and less efficient with geo.
  8. shagster

    shagster New Member

    Curious about the efficincy hit from high velocity

    Are there any estimates of the typical efficiency impact using high a velocity air handler? It does seem silly to pay for the most efficient system, then knock the efficiency down with the air handling system, but there is still a tradeoff to consider for us regarding usability of our basement post ductwork.
  9. engineer

    engineer Well-Known Member Industry Professional Forum Leader

    I'm with Joe on high velocity systems, but there is another expert here and at GreenBuildingTalk (Mark Custis) who swears by them.

    My objections are theoretical, not backed by experience.
  10. Mark Custis

    Mark Custis Not soon. Industry Professional Forum Leader

    To enjoy

    the benefits of HV you need to know how they work.

    They now come with enhanced PSC blowers and ECMs.

    They can be installed by morons if the design is good. If they touch the geo they count for the tax credit.
    Last edited: Feb 16, 2011
  11. AMI Contracting

    AMI Contracting A nice Van Morrison song Industry Professional Forum Leader

    I'm not convinced you will save as much basement head room as you suspect. Certainly wouldn't be worth the additional cost.
    HV will cut capacity of geo or conventional cooling systems and ASHPs. Is the penalty worth it? Depends.....on the job, your goals etc.
  12. shagster

    shagster New Member


    I have not seen any HV systems up close, just what I could see on the web. It looked like the ductwork would more easily fit in between the joists instead of under the joists, but it's clear I need to do more homework before considering HV a cure-all.

  13. Mark Custis

    Mark Custis Not soon. Industry Professional Forum Leader

  14. AMI Contracting

    AMI Contracting A nice Van Morrison song Industry Professional Forum Leader

    HV branches will fit in a wall cavity, but.....the trunk, not so much.
  15. shagster

    shagster New Member

    A little more on the tax credits

    Sorry to take so long to reply. While investigating the issue, I was perplexed that my brochure for the Envision split (2010 edition) said the following:

    "Water Furnace Envision Series units are performance-certified by the Aair Coditioning and Refrigeration Institute, safety listed by ETL, and exceed performance standards for the ENERGY STAR rating."

    The 2011 brochure states:
    "WaterFurnace Envision Series Units are performance-certified by the AHRI, safety listed by ETL and exceed performance standards for the ENERGY STAR rating when mated to a WaterFurnace Air Handler."

    So it appears that for 2011 the Geo unit can not be energy star rated without certification with a specific air handler.:mad:
  16. geome

    geome Member Forum Leader

    WF, would you please clarify this for us? The link below shows the "Certification of Geothermal Property Compliance" which list your split systems, but I don't see any mention of air handlers (but I may have missed it.) Thank you.
  17. AMI Contracting

    AMI Contracting A nice Van Morrison song Industry Professional Forum Leader

    Certifications cost money. No manufacturer is going to pony up the dough to certify their equipment with every available after market airhandler.
    The end point is the heat pump itself is EStar ergo tax credit worthy. Tax forms don't ask about the air handler.....
    (consult your accountant....not a tax pro....yadda yadda)
  18. engineer

    engineer Well-Known Member Industry Professional Forum Leader

    Is it that simple?

    EnergyStar requires certain minimum SEERs, COPs, and EERs, and those are only achieved with matched and listed components.

    There may be a vanishingly small chance of getting called on this, but it is what it is.

    Perhaps Unico has an angle on the E-Star question - seems it would be in their interest to pursue certs since they don't make compressor sections.
  19. docjenser

    docjenser Well-Known Member Industry Professional Forum Leader

    It appears to me that the tax credits are linked to the heatpumps, but for your distribution equipment, you are free to choose whatever you like, and it becomes part of the overall geosystem. Other needed equipment, such as circulation pumps, groundloops etc are not rated either for any efficiency..
  20. Mark Custis

    Mark Custis Not soon. Industry Professional Forum Leader


    While packing the monster home to go visit Joe Hardin of AMI Contracting fame in Michigan, I got a nice email from UNICO Systems anouncing their new ECM drive air handlers. They have some very educational vids available in the email links. If you can not get to them from their home page drop me a PM here and I will forward what they sent me. Certs will no longer be an issue with H/V systems from Unico.

    I am in a state park in MI after letting Joe beat me to death up and down stairs. We have been working together for a great family on a super project. More on that later. I am brain dead having worked for two days plus chasing wires to make a system with 5 water to water geos run from an iPhone.

    Last edited: May 7, 2011

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