Leased HVAC and Solar Panels

[wallacedk]

My understanding is that the energy credit for leased solar panels goes to the leasing company and the customer is not eligible for the tax credit on their 1040.  I have a tax client that is leasing a new furnace.  Does the HVAC company also get the energy credit for furnace lease.  The lease is a lease to own after 25 years of leasing.

[sjrcpa]

Never heard of leasing a furnace.

What happens at the end of the lease? Does the company remove it?

[TaxGuyBill]

I'm with Susan; I've never heard of leasing a furnace.  It seems weird.

At any rate, I don't think anybody gets the credit.  The "original use" is the HVAC company leasing it to the taxpayer, so I don't see how the taxpayer can get a credit.  The HVAC company doesn't use the home as a Residence, so they don't get a credit either.

[wallacedk]

HVAC companies in my area are now doing it.  It is a 25 year lease to own, with the lease payments also covering maintenance.  After 25 years of lease payments the homeowner owns the furnace.

[wallacedk]

HVAC companies in my area are now doing it.  It is a 25 year lease to own, with the lease payments also covering maintenance.  After 25 years of lease payments the homeowner owns the furnace.

[sjrcpa]

Research capital lease and operating lease. You may find taxpayer actually owns the furnace for tax purposes.

[IRonMaN]

Sounds like the old comedy skit - $99 down, $99 a month, for 99 years.