The $5,000 rule is a rule of thumb in the HVAC industry to help homeowners decide whether HVAC repair or HVAC replacement makes more sense in the long run. The $5,000 rule: Multiply the age of your equipment by the estimated repair cost. If the number is more than $5,000, then you should consider replacing your unit.
On average, you can only expect about 15 years of reliable service from a central AC system. And that's only if you maintain your system well. So, if your home has an AC that's 20 years old or older, it's likely living on borrowed time. Here are all the reasons to replace your home's 20-year-old air conditioner.
The New Regulations
Starting January 1, 2025, all new residential air conditioners and heat pumps must utilize A2L refrigerants. Older refrigerants like R-410, which are likely the refrigerant used by your current system, are being phased out.
The overall total limit for an efficiency tax credit in one year is $3,200. This breaks down to a total limit of $1,200 for any combination of home envelope improvements (windows/doors/skylights, insulation, electrical) plus furnaces, boilers and central air conditioners.
Best AC Temperature Settings While You Are Home
As you consider the most comfortable room temperature for your lifestyle and family, keep in mind that for each degree that you set your thermostat above 72 degrees, you can save up to 3% on your energy bill.
Finding the right AC temperature for your electricity bill is a balancing act. By setting it around 78°F and considering external factors, you can enjoy comfort and save on energy costs simultaneously. Remember, small adjustments can lead to significant savings over time.
While ENERGY STAR suggests 82 degrees, that may be too uncomfortable for most families. Most people sleep better when their sleeping area is chilly, so that's why the National Sleep Foundation advises 60–67 degrees.
SEER Requirements for Qualifying for a Tax Rebate
If eligible, you could receive a tax rebate of up to $1,200. Although this won't be a cash-in-hand payment, it will offset your end-of-year tax debt or increase your tax return. Only ENERGY STAR-rated air conditioners with SEER2 ratings of at least 16 are qualified.
You may be eligible for a California Earned Income Tax Credit (CalEITC) up to $3,644 for tax year 2024 as a working family or individual earning up to $30,950 per year. You must claim the credit on the 2024 FTB 3514 form, California Earned Income Tax Credit, or if you e-file follow your software's instructions.
Can I deduct the cost of a new roof? Unfortunately, you cannot deduct the cost of a new roof. Installing a new roof is considered a home improvement and home improvement costs are not deductible. However, home improvement costs can increase the basis of your property.
Efficiency ratings are regional, so the new HVAC regulations for 2024 depend on where you live. New air conditioners in Northern regions must have a minimum SEER rating of 14. In Southern regions, the minimum SEER rating is 15 for most units.
This move technically went into effect on January 1st, 2023, so it's already been a year. Under the DOE rules, US HVAC manufactures will discontinue production of SEER 14 units, and they can no longer sell any units with that rating, either.
HVAC systems manufactured in 2025 and beyond will no longer use R-410A, the most common refrigerant in current residential air conditioning units and heat pumps. This is part of a global effort to reduce the environmental impact of refrigerants that contribute to global warming and ozone depletion.
While every unit is different, and every homeowner has a different understanding of when their central air conditioner is broken beyond repair, it's fair to say that, with proper maintenance and care, you can expect a good 15 to 20 years of cooling from a new high efficiency air conditioning system.
Benefits of Replacing Your AC Condenser
Improved energy efficiency: A new condenser unit can reduce your energy bills and save you money over time. Increased comfort: A new system can cool your home more effectively, providing you with greater comfort during hot weather.
How much will a new AC unit save me? How much you can save with a new AC unit will depend on your old unit, the replacement model, how much you use your air conditioning, and the cost of electricity where you live. Estimates vary from 10% to 50% savings on your air conditioning costs per year.
The minimum income amount depends on your filing status and age. In 2024, for example, the minimum for Single filing status if under age 65 is $14,600 . If your income is below that threshold, you generally do not need to file a federal tax return.
If you itemize, you can deduct a part of your medical and dental expenses, and amounts you paid for certain taxes, interest, contributions, and other expenses. You can also deduct certain casualty and theft losses.
You can't claim the EIC unless your investment income is $11,600 or less. If your investment income is more than $11,600, you can't claim the credit.
Certain high-efficiency central air conditioners and furnaces meet eligibility criteria for a 30% tax credit, providing lower energy consumption and substantial savings on utility bills.
According to the Kobie SEER Energy Savings Calculator, a 16 SEER unit uses about 13% less energy to produce the same amount of cooling as a 14 SEER unit of the same size. That means that for every $100 you'd pay to run your 14 SEER unit, you could save $13 by upgrading to a 16 SEER unit.
For many of us, 70 degrees is the ideal indoor temperature, but when it is close to 100 degrees outside, your AC unit will be working quite hard to meet these expectations. Consider setting your thermostat at 75 degrees to 80 degrees in your home if the outside temperature is approaching triple digits.
Quick answer: The ideal house temperature is room temperature, which ranges from 68 to 78 degrees F, though this may vary from season to season. In winter, the average room temperature is generally 62 to 68 degrees, whereas in the summer, the average temperature is 72 to 78 degrees.
You can also reduce your energy costs significantly by raising the temperature while you are at work, away from home, or asleep. For the greatest savings, consider setting your thermostat to: About 78 degrees while you are at home. About 82 degrees while you are sleeping.